|Bid||0.00 x 0|
|Ask||0.00 x 0|
|Day's Range||71.16 - 72.70|
|52 Week Range||63.76 - 92.71|
|Beta (5Y Monthly)||0.84|
|PE Ratio (TTM)||15.28|
|Earnings Date||Feb 27, 2020|
|Forward Dividend & Yield||1.80 (2.51%)|
|Ex-Dividend Date||Nov 19, 2019|
|1y Target Est||99.21|
Millennials are putting a cork in their wine habit. U.S. wine sales have fizzled for the first time in 25 years as young adults sip spiked seltzers and spirits, instead. The volume of U.S. wine purchases slipped 0.9% in 2019, according to alcohol industry tracker IWSR — the first drop since 1994.
The long overdue rebound in marijuana stocks is finally here. The cannabis sector, led by the segment's most important company, Canopy Growth (NYSE:CGC), are breaking out in early 2020. Investors are betting that the demand and legislative troubles of 2019 will fade, and the whole industry will rebound in a big way over the next several quarters.Source: Shutterstock This isn't a small breakout, either, but a material one: Canopy Growth stock is already up 12% in 2020. That's basically 1% growth every trading day and represents the most upward momentum this stock has seen since early 2019. And it's worth noting that the move has also been on big volume, so there appears to be a lot of money out there staking big on a huge CGC turnaround.That's the good news for bulls. Here's the better news -- this big Canopy Growth stock turnaround will only get bigger as we go deeper into 2020.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 10 Cheap Stocks to Buy Under $10 In a nutshell, favorable fundamental developments in the cannabis market will spark a significant growth trend reversal for Canopy over the next few quarters. This growth trend reversal will converge on what is still a very beaten-up and relatively discounted CGC stock. That convergence will spark a huge rally in shares to levels north of $30.Here's a deeper look. Favorable Fundamentals Will Develop in 2020Thanks to weakening fundamentals in the global cannabis market, Canopy's growth trajectory meaningfully slowed in 2019. I think that will change in 2020. Cannabis market fundamentals will strengthen and Canopy's growth trajectory will meaningfully improve.This thesis breaks down into three components: revenue growth re-acceleration, profit margin stabilization and net loss reduction.First, the introduction of new products like vapes and edibles into the Canadian market, coupled with significant legal retail footprint expansion, will re-ignite demand growth throughout Canada's legal cannabis market over the next few months. At the same time, Canopy Growth will aggressively pivot into the U.S. market with its First & Free hemp product line. Canadian legal demand revival coupled with new U.S. revenue streams will improve Canopy's revenue growth trajectory in 2020.Second, as demand trends in Canada improve in 2020, demand will finally start to catch up to a supply glut in the market. This will lead to more favorable market pricing and higher gross margins for Canopy Growth. Simultaneously, Canopy's 2019 production facilities will start to produce at capacity in 2020, which will also provide a year-over-year margin boost. Net net then, Canopy's 2019 margin headwinds could turn into 2020 margin tailwinds.Third, the combination of revenue growth re-acceleration and profit margin stabilization will lead to Canopy reporting narrower losses. That's a big deal for a hyper-growth, unprofitable company that needs to inch towards profitability in order to justify its valuation. Canopy Growth Stock Will SoarBecause of the three aforementioned fundamental improvements, CGC is set to soar in 2020.The logic is pretty simple. Investors once believed that Canopy would emerge as the top dog in an ultra valuable global cannabis industry. But slowing growth and profitability concerns clouded that bull thesis, and ultimately knocked shares down to $20. Those slowing growth and profitability concerns will ease significantly in 2020. As they do, investors will start to once again buy into the idea that Canopy is going to emerge at the top dog in a huge global cannabis industry.The last time investors believed that, Canopy Growth stock was up at $50. Shares could make a run for that level again as investors once again adopt this bullish mentality amid re-accelerating growth, stabilizing margins and narrowing losses.The numbers are pretty simple, too. Under the paradigm that Canopy will leverage its unparalleled size, resources, partnerships, and distribution to turn into the Altria (NYSE:MO) or Anheuser-Busch (NYSE:BUD) of a several hundred billion dollar global cannabis industry at scale, I think that Canopy reasonably projects to earn $5 in profits per share by fiscal 2030.Based on a forward earnings multiple of 16 and a 10% annual discount rate, that implies a a 2020 price target for Canopy Growth stock of about $33 to $34. Bottom Line on CGC StockCGC had an awful 2019 amid deteriorating cannabis market fundamentals. Shares will bounce back in 2020 amid improving cannabis market fundamentals. This rebound has already started in the first two weeks of 2020, and will continue for the balance of the year. Ultimately, Canopy Growth stock will head way higher over the next several months.As of this writing, Luke Lango was long CGC. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Cheap Stocks to Buy Under $10 * 5 Retail Stocks Placer.ai Thinks Can Win Big in 2020 * 6 Cheap Stocks to Buy Under $7 The post The Big Rebound in Canopy Growth Stock Will Only Get Bigger appeared first on InvestorPlace.
(Bloomberg) -- Sign up to our Next Africa newsletter and follow Bloomberg Africa on TwitterAnheuser-Busch InBev is installing solar panels at South African breweries in a push to reach global environmental goals that comes as state-owned utility Eskom Holdings SOC Ltd. struggles with blackouts.The brewer of Budweiser beer said it’s joined an 18 billion rand ($1.3 billion) pan-African plan to generate more energy from environmentally friendly sources. The solar panels in South Africa are just one part of the initiative, which includes partners and spans the region.The world’s biggest brewer has set a global target of securing all of its purchased energy from renewable sources by 2025. The company this month partnered with others in Europe to tap green power from BayWa r.e., a German renewable energy developer.The latest move comes as Eskom has had to institute rolling electricity blackouts due to operational problems. That has prompted South African companies to secure electricity through other means, although regulations require them to buy some of their power from the utility.“We can’t do 100% renewable power in Africa at this stage” because of the sourcing rules and the instability of some power grids, said Taryn Rosekilly, vice president for sustainability at AB InBev Africa.AB InBev is completing solar electricity projects at seven South African manufacturing sites and also testing electric trucks for deliveries.Solar power at the breweries will provide 10% to 15% of the energy needs of AB InBev’s South African businesses and costs 15-20% less than buying electricity generated by Eskom, the company says. Other green power generation options being considered include wind and converting liquid waste produced by the breweries into gas.By the end of this year, AB InBev plans to use wind and solar power at a malting plant in Caledon, in South Africa’s Western Cape province. It will be the first South African site using 100% renewable energy.To contact the reporter on this story: Janice Kew in Johannesburg at firstname.lastname@example.orgTo contact the editors responsible for this story: Eric Pfanner at email@example.com, John LauermanFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
The beer industry is made up of companies specializing in the production of beer, but which also produce other alcoholic and non-alcoholic beverages. Beverages are considered consumer staples and thus the beer industry may be considered a small part of the broader consumer staples sector.
Investors looking for further evidence of the growth of hard seltzer should pay extra attention during Super Bowl LIV. AB InBev, the parent company of Budweiser, believes it has a "beautiful opportunity" during the Super Bowl to market its Bud Light Seltzer to both Bud Light drinkers and non-Bud Light drinkers, WSJ quoted the company's U.S. marketing chief Marcel Marcondes as saying on a conference call.
Is Anheuser-Busch InBev SA/NV (EBR:ABI) a good dividend stock? How can we tell? Dividend paying companies with growing...
(Bloomberg) -- Anheuser Busch InBev’s Felipe Dutra may step down after about 15 years as chief financial officer of the world’s largest brewer, a person familiar with the matter said.Succession planning is routine for officials at his level, according to the person, who asked to remain anonymous as the information isn’t public. Timing of the change isn’t known and Nelson Jamel, the company’s financial head for North America, is one of a number of people under consideration as a replacement, the person said.AB InBev has disappointed investors as Chief Executive Officer Carlos Brito reported earnings below analysts’ estimates in four of the past eight quarters. Brito halved the brewer’s dividend payout in 2018 amid sluggish progress on debt reduction following the acquisition of SABMiller in 2016, although moves such as the disposal of the Asian business are aimed at cutting borrowings.The shares fell as much as 1% in Brussels Wednesday.The Financial Times reported earlier that AB InBev was considering replacing Dutra. A company representative declined to comment. A call to Dutra’s office after business hours wasn’t answered.(Updates with shares in fourth paragraph)To contact the reporter on this story: Thomas Buckley in London at firstname.lastname@example.orgTo contact the editors responsible for this story: Eric Pfanner at email@example.com, John Lauerman, Jonathan RoederFor more articles like this, please visit us at bloomberg.com©2020 Bloomberg L.P.
The sum is enough to buy all but a few dozen of the companies in the S&P 500, yet billionaire Warren Buffett, below, hasn’t yet been tempted to use that cash to buy a new glittering prize. was a multibillion-dollar buyout of famed jeweller Tiffany & Co, which contacted the so-called Oracle of Omaha after it had received a takeover offer from France’s LVMH, DD’s Eric Platt first reported. For the 89-year-old’s investment company, Berkshire Hathaway, it was yet another opportunity it passed on and a reminder that Buffett has been gun shy as valuations of blue-chip US companies have surged in recent years.
Anheuser-Busch InBev is preparing to replace its long-serving chief financial officer Felipe Dutra as the brewer of Budweiser and Stella Artois seeks to revive its fortunes and share price, according to people briefed on the matter. The expected shake-up follows the replacement of the group’s chairman in April last year, with Martin J Barrington, former chief executive of tobacco group Altria, promoted to the role. Altria owns 9.5 per cent of AB InBev, and together with the three Brazilian founders of 3G Capital and the Belgian and Colombian families who sold their regional beer dynasties to AB InBev they control more than half the company’s shares.
(Bloomberg) -- A stellar start to 2019 for food and drink stocks largely fizzled out in the second half of the year, and Unilever’s recent sales warning has left a cloud hanging over the sector outlook for 2020.Despite a lackluster few months, the Stoxx 600 Food & Beverage index is still on course for its best year since 2009, with a 27% gain slightly outperforming the region’s main gauge. But after what Citigroup Inc. described this month as one of the worst staples earnings seasons of the past 20 years, investors have become unsettled, not helped by this month’s announcement by Unilever that revenue will be in the lower half of its guidance range in 2020.In beverages, beer stocks were hot in 2019, led by a surge in Carlsberg A/S, but 2020 may be a better year for spirits, which are ripe for a rebound thanks to elements such as emerging-markets growth and continuing high levels of cash returns, according to Citi analyst Simon Hales. Brewers should get a boost from the UEFA Euro 2020 soccer tournament starting in June, in particular sponsor Heineken NV.Below are five things for investors to watch in 2020:More M&A (and an IPO?)Expect staples giants to continue reshaping their portfolios after Nestle SA’s divestment of U.S. ice cream and Herta meats, and Anheuser-Busch InBev NV’s Asian IPO in 2019.Unilever’s new Chief Executive Officer Alan Jope must make “sharper decisions” on this front, and the company’s food & refreshment brands could be the focus of disposals, according to Jefferies analyst Martin Deboo. Nestle also may shed more assets, with Buitoni pasta in the U.S. being one potential candidate, says Vontobel Holding AG’s Jean-Philippe Bertschy. Meanwhile, JAB Holding Co. is mulling an initial public offering of its coffee business in Amsterdam, which could raise as much $3.4 billion.In beverages, Aperol maker Campari SpA is still scouting for acquisitions and AB InBev also may return to M&A after making inroads on debt, with the buyout of Castel Group an often-touted target. Still, a dearth of big M&A candidates may be a bigger problem for beverage companies, according to Sanford C. Bernstein analyst Trevor Stirling.Healthy Munching and BoozeAfter January’s introduction of a vegan sausage roll by Greggs Plc and a new plant-based burger by Nestle, healthier eating (and drinking) will remain a focus in 2020.Consumers, companies and investors alike are showing increased interest in environmental, social and governance issues and healthier lifestyles, and this continues to accelerate, according to Eddy Hargreaves, an analyst at Investec Wealth & Investment Ltd.Stocks to watch include Kerry Group Plc, whose flavors and fragrances might help food and beverage companies develop new products with less sugar, according to Berenberg analysts. They also give a mention to sports nutrition leader Glanbia Plc and to AB InBev and Molson Coors Brewing Co. for their low-calorie beer offerings.Drinks such as Diageo Plc’s Ketel One Botanical (vodka infused with natural fruit essences, no artificial sweeteners and no added sugar) are gaining traction in the U.S. because of their low-calorie content, while no- or low-alcohol beer remains popular in Europe, says Berenberg analyst Javier Gonzalez Lastra.China and More ChinaThe outlook for a China-U.S. trade deal may have brightened, but the threat of U.S. tariffs will continue weighing on the likes of Remy Cointreau SA and Pernod Ricard SA. There are direct potential impacts such as tariffs on single-malt Scotch whisky, which would disadvantage single malts compared with other spirits, but there are also indirect tariffs as companies pass the higher input costs onto consumers, according to Liberum analyst Nico Von Stackelberg.“It’s a bit like having a higher oil price,” he says. “The net impact is less money in the wallet after all essentials are paid for.”Social upheaval in Hong Kong will also remain a drag for these and other stocks. China is a key growth engine and executives will continue strategizing on how best to grow there after deals such as Heineken’s partnership with China Resources Beer Holdings Co. in 2019.There’s another new threat coming from China in the form of local premium brands that finally seem to be taking off there, Berenberg’s fivGonzalez Lastra said. “Consumers appear more open about embracing Chinese champion brands,” he said.Hard Seltzers, Gin and CannabisAnalysts are wondering whether the mania of U.S. millennials for low-calorie, low-carb hard seltzers, a mix of water, alcohol and fruit flavors, can ever catch on with Europeans too. Questions also linger on whether the current gin craze in Europe will last and whether rum could be the next big thing.One thing’s for sure: in 2020 investors will continue closely tracking developments made on cannabis-infused drinks. A joint venture between Tilray Inc. and AB InBev is currently introducing cannabis-infused teas in Canada, soon to be followed by carbonated soft drinks also containing pot, according to Bryan Garnier & Co.Last but not least, one product that’s nowhere close to falling out of favor is chocolate, but even in this field innovation matters: Barry Callebaut AG’s ruby chocolate recently won U.S. regulatory approval.PremiumizationU.S. Nielsen data has been closely watched among Fevertree Drinks Plc analysts this year as they gauge the growth potential for premium mixers in that market. The acceleration of growth in the second half of 2019 bodes well going into the new year, according to Berenberg.Meanwhile, Pernod Ricard SA has been ramping up its purchases of premium liquor brands. The Paris-based company bought the owner of the TX American whiskey and bourbon brands in August, as well as the Malfy Italian gin brand in April. Jefferies called Pernod “one of the few remaining change stories within beverages,” with the shift toward premium spirits continuing to be strong, while Citigroup upgraded the stock to buy this month, predicting a pick-up in trading momentum in the last three quarters of fiscal 2020.\--With assistance from Phil Serafino.To contact the reporters on this story: Albertina Torsoli in Geneva at firstname.lastname@example.org;Lisa Pham in London at email@example.comTo contact the editors responsible for this story: Beth Mellor at firstname.lastname@example.org, Paul Jarvis, Namitha JagadeeshFor more articles like this, please visit us at bloomberg.com©2020 Bloomberg L.P.
Apparently, beer is a bear market.After dominating the U.S. beverage market, beer sales have fallen flat -- all as consumers opt for alternatives. For example, craft beer sales were up 7% in 2018 to $27.58 billion, giving it a 24.2% share of the $114.2 billion U.S. beer market. That's up from 23.4% in 2017.The bearish trend can also be attributed to millennials, who are less likely to drink beer, and are more likely to drink wine or spirits when they do consume alcohol.InvestorPlace - Stock Market News, Stock Advice & Trading TipsAdditionally, this shift can also be attributed to cannabis. "The emergence of legal cannabis in certain U.S. states and Canada may result in a shift of discretionary income away from our products or a change in consumer preferences away from beer," once noted Molson Coors (NYSE:TAP).It is part of the reason Constellation Brands took a 9.9% stake in cannabis giant, Canopy Growth Company (NYSE:CGC)."We believe alcohol could be under pressure for the next decade, based on our data analysis covering 80 years of alcohol and 35 years of cannabis incidence in the US," analysts at Cowen noted. "Since 1980, we have seen 3 distinct substitution cycles between alcohol and cannabis; we are entering another cycle." * 7 Stocks to Buy to Get 2020 Started the Right Way However, as beer companies wake up to changing demands for cannabis and health-conscious beverages, I'm spotting quite a few big opportunities. Here are three beer stocks to look into before the New Year. Beer Stocks to Buy Before 2020: Anheuser-Busch InBev (BUD)Source: legacy1995 / Shutterstock.com One of the biggest beer companies in the world got an icy reception in the latter part of 2019.In fact, Anheuser-Busch InBev (NYSE:BUD) lost 23% of its value after weak sales in China became a drag on earnings, and after cutting its forecast for the year ahead. However, it appears the worst has been priced into the stock."While the quarter left much to be desired, management believes the company is well positioned for accelerating revenue growth over time. With the addition of SAB Miller, Anheuser-Busch is more diversified than ever," says Motley Fool contributor, John Ballard. "Emerging markets make up about 70% of the company's total volume, which holds a lot of opportunity to bring in new consumers for the largest beer maker in the world, with 26% global market share."Plus, BUD is well-diversified in cannabis. In late 2018, it announced a $100 million cannabis deal with Tilray (NASDAQ:TLRY) to develop cannabis-infused, non-alcoholic drinks. Not only is BUD well-positioned for international growth, it is positioning itself among a health conscious, cannabis-loving generation. Plus, Guggenheim analyst Laurent Grandet reiterated a "buy" on BUD. While he argues earnings weren't as strong as he would have liked, he still believes BUD has "one of the most attractive growth algorithms in the space with continued optionality for M&A given the recently completed IPO in Asia-Pacific." Boston Beer Co. (SAM)Source: LunaseeStudios / Shutterstock.com Since the year began, Boston Beer Co. (NYSE:SAM) has been one of the most explosive alcohol stocks on the market. Between January and December, shares have run from $231.57 to nearly $385 with plenty of upside remaining.UBS just upgraded the SAM stock to a buy from a neutral rating, with a new price target of $440 -- all thanks to strong growth in the company's seltzer business. In fact, sales of Boston Beer's Truly brand of hard seltzer are so hot, the company can't handle the demand; That's not a fad either.White Claw's hard seltzer is already seeing a nationwide shortage of its drinks in the U.S. As Americans seek out drinks with fewer calories and less sugar, they're turning to hard seltzers. White Claw and competitor Truly both have around 100 calories per can, for example. * 7 Momentum Stocks Refusing to Slow Down Even Anheuser-Busch launched its line of seltzer. "These new products can help those companies, such as Anheuser-Busch, 'buffer those losses,'" Beth Bloom, associate director of US Food and Drink for Mintel has said, because beer sales are declining. Constellation Brands (STZ)Source: ShinoStock / Shutterstock.com Constellation Brands (NYSE:STZ) shares are up nicely from a 2019 low of $150.37 to around $200 in October with plenty of volatility in between.While its biggest beer brands -- including Modelo and Corona -- are still enjoying fast growth, STZ's diversification into the wine business should also bolster higher highs for the stock. For example, it just announced a deal with E&J Gallo Winery to buy more than 30 wine and spirit brands along with six wine-making facilities in the U.S. It is also launching a Corona-branded spiked seltzer mid-2020. Because of that and once the cannabis boom gets back underway, I strongly believe Constellation can be a $250 stock before long.As of this writing, Ian Cooper did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Stocks to Buy to Get 2020 Started the Right Way * 10 Best ETFs for 2020: The Competition Is Stacked Full of Potential * 4 Gold Stocks to Buy as the Yellow Metal Surges The post 3 Beer Stocks to Own Heading Into New Year 2020 appeared first on InvestorPlace.
(Bloomberg Opinion) -- Growing up in the U.K. in the 1980s, the Christmas season was associated with particular foods and drinks. Pies made from fruit “mincemeat”; the same dried fruits cooked into Christmas pudding; grandparents passing round glasses of sherry.Believe it or not, that nostalgic memory hints at a long-term risk to the most bullish corner of the global liquor market: China’s sorghum-based firewater, baijiu.The past few years have seen extraordinary growth for baijiu makers. Kweichow Moutai Co., the maker of the most prestigious brand, overtook Diageo Plc to become the world’s biggest distiller by market capitalization in 2017. Now it’s in a whole other league, overtaking even Anheuser-Busch InBev SA and PepsiCo Inc. on that measure and within spitting distance of taking Coca-Cola Co.’s crown as the world’s largest beverage company.What’s more, this success has been built on the back not of a valuation bubble, but of relatively pedestrian assumptions about earnings. Kweichow Moutai is on a lower price-earnings multiple than Brown-Forman Corp., Davide Campari-Milano SpA and Remy Cointreau SA. Luzhou Laojiao Co. is cheaper on that measure than any major western distiller.What could possibly put a cloud on the horizon of this thriving market? The most serious looming risk is embodied in those nostalgic memories of a British Christmas: demographics.Throughout baijiu’s boom, it’s struggled to shake the perception that it’s primarily a drink for older men. Its former image as an unofficial currency of corrupt government officials has receded since a campaign against official graft in the early years of President Xi Jinping’s reign. Still, the connotations of rich older men exchanging drunken toasts remain, even if the drinkers in the stereotype are now more likely to be employed in the private than the public sector.“Many young people still think that baijiu isn't for them, that no matter the flavor, it's not a drink for the young,” according to a China Daily article this year. “Drinking baijiu is increasingly seen as a dated behavior by younger Chinese uninterested in banquets and bravado,” wrote Jing Daily, a site specializing in the Chinese luxury market.That association with oldsters is a problem Spain’s sherry industry has been enduring for several decades. In the 1970s and 1980s, exports to the U.K., the Netherlands and the U.S. boomed in an unprecedented manner, to the point that bodega conglomerate Rumasa was reported to account for as much as 2% of Spanish GDP.Since then it’s been in long-term decline. Sherry’s core consumers outside Spain have reached a more abstemious age or died out, while younger drinkers shun a product they associate with their grandparents. For all that many wine connoisseurs sing its praises and lament sherry’s fall from grace, it’s hard to see the glory days returning.This trajectory is a common one in the alcohol business, which lives and dies on the changing demographics of its consumers. One reason Japan’s brewers have been so desperate to acquire overseas businesses while Vietnamese ones have been M&A targets is that beer is drunk by thirsty workers, and Japan’s labor force is declining while Vietnam’s is rising. The same goes for clear spirits like baijiu. Its success is hard to separate from the fact that China’s population of men aged 40 to 60 increased by more than half over the past two decades, adding about 78 million people to the core baijiu-drinking market. That demographic is set to stagnate over the coming decade, though, before beginning an accelerating decline after 2030.To the extent that the industry is making any inroads with women and younger people, it’s in lower-cost, lighter-flavored “rice aroma” products where margins are tighter. The giant listed baijiu-makers specialize in the complex, higher-cost “sauce aroma” and “strong aroma” varieties such as Maotai and Luzhou Laojiao, which is quite a different product.This needn’t be the end of the world. The drinks market’s best defense against unfavorable demographics is “premiumization” — counting not on a larger number of consumers, but a small group paying more and more. Premiumization is already the strategy of the high-end listed baijiu companies, so there's no reason they can’t keep going with it.Still, chasing the luxury market is notoriously expensive in marketing terms, and baijiu makers for years have been able to rely on a product that sells itself.Major distillers typically dedicate a third or more of their revenue to selling, general and administrative costs — mostly marketing and distribution. Baijiu makers are far more thrifty, one reason their profit margins are so much fatter than those of peers. As their core demographic ages out of its drinking habit, though, they’re likely to have to spend more and more converting younger drinkers.Every cellar manager knows that liquors can get better with age, but the process of maturation has to be carefully monitored and cultivated if the precious drink isn’t to turn into drain-cleaner. Marketing departments of baijiu companies will have to be no less careful over the coming decades maintaining the shine on their storied brands. To contact the author of this story: David Fickling at email@example.comTo contact the editor responsible for this story: Matthew Brooker at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.David Fickling is a Bloomberg Opinion columnist covering commodities, as well as industrial and consumer companies. He has been a reporter for Bloomberg News, Dow Jones, the Wall Street Journal, the Financial Times and the Guardian.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Today we'll do a simple run through of a valuation method used to estimate the attractiveness of Anheuser-Busch InBev...
An Indian court dismissed Anheuser-Busch InBev's appeal against a New Delhi city sales ban on Thursday, a blow to the world's largest brewer in one of its key market. Authorities in New Delhi barred AB InBev in July from selling its beer for three years over allegations of evading state taxes, which the company has denied. The Delhi city government's Commissioner of Excise later reduced the ban to 18 months.
Fluent Beverages, a Canadian joint venture between Tilray (NASDAQ: TLRY) and AB InBev (NYSE:BUD), has unveiled Everie, the company’s first non-alcoholic CBD-infused beverage. Everie is a 98 percent pure CBD-infused beverage with all-natural flavors. It is manufactured in partnership with High Park at its cannabis facility in London, Ontario, Fluent said in a statement. "We […]The post Fluent Launches CBD-Infused Beverage Brand in Canada appeared first on Market Exclusive.
So-called "sin stocks" often provide higher returns. If some investors simply won't buy a stock for ethical or moral reasons, that in turn lowers the current share price and provides an opportunity for those willing to own that same stock.It's possible, though not guaranteed, that sin stock returns will be higher in an era of ESG (environmental, social and governance) investing. As AQR's Clifford Asness noted back in 2017, the very goal of ESG investing actually is to lower expected returns. That in turn reduces that company's cost of capital and makes projects more profitable. Conversely, sin stocks have a higher cost of capital, an impediment to the business but somewhat counterintuitively a boost to returns for those willing to invest in those names.That said, individual sin stocks have much the same risks as the rest of the market. In some cases, the risks are greater given tighter regulation and changing consumer behavior. Altria (NYSE:MO) is a great example: what not that long ago was the greatest stock ever declined over 40% before a recent bounce.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 'A'-Rated Stocks to Buy Before 2020 These three sin stocks could follow that same trajectory in a worst-case scenario. And so investors probably should look elsewhere in the group, both during the holiday season and after it. Boston Beer (SAM)Source: LunaseeStudios / Shutterstock.com To be fair, I've been wrong on Boston Beer (NYSE:SAM) so far. SAM stock has nearly doubled since I recommended against it nearly two years ago. And there is a lot to like here. Boston Beer's Truly is a leader in the fast-growing hard seltzer space. The acquisition of Dogfish Head in May added to the beer portfolio. And the flagship brand has a solid reputation and nationwide reach.Still, I'd be careful, at least, owning SAM stock above $350. Valuation is questionable, at over 30x forward earnings. Overall beer consumption, even for craft beer, is declining on a barrel basis. Wine and spirits are taking share. Hard seltzer could be a growth opportunity -- or it could be something of a fad.There are risks here, and SAM already has pulled back from August highs. I wouldn't be at all surprised if that pullback extends. Anheuser-Busch InBev (BUD)Source: legacy1995 / Shutterstock.com Anheuser-Busch (NYSE:BUD) already has seen its pullback. BUD stock touched a six-year low late last year. Shares rallied from those levels, but have reversed and trade at a nine-month low.From a near-term standpoint, BUD seems particularly risky. Shares have breached support at $80, and even with some modest rallies in recent sessions there's room for the stock to give way.From a long-term standpoint, Anheuser-Busch InBev stock too looks dangerous. At 17.3x forward earnings, BUD stock hardly looks cheap. Sales are declining as craft beer continues to take share in the U.S. A 2.6% dividend yield is attractive, but Anheuser-Busch InBev halved its dividend last year and may cut it again as it tries to manage a significant debt load. An $11 billion asset sale to Asahi (OTCMKTS:ASBRF) has been held up by regulators, a potential stumbling block to reducing borrowings that total roughly $100 billion at the moment. * These 7 S&P 500 Stocks Will Deliver a Repeat Performance in the Next Decade There are real risks here -- and real reasons why BUD stock has pulled back so sharply. It's not hard to see echoes of Kraft Heinz (NASDAQ:KHC), another company that took on too much debt and then had to deal with significant, secular, changes in its industry. Simply put, Anheuser-Busch is going in the wrong direction right now, and the same likely will hold true for BUD stock. Canopy Growth (CGC)Source: Jarretera / Shutterstock.com To be fair, it's possible that Canopy Growth (NYSE:CGC) will rally during the holidays and into 2020. As I wrote just last week, "Cannabis 2.0" products have the potential to help revenue next year. The arrival of a new chief executive officer from Constellation Brands (NYSE:STZ,NYSE:STZ.B), who owns over 40% of the company, has sparked hopes for a takeover. CGC stock already has bounced, yet it and other cannabis stocks trade significantly off early 2019 highs.That said, I'm hardly sold on CGC stock at the moment. A new CEO may help, but execution has been poor for some time now. Pricing pressure in Canada should pressure margins. Barring movement in the U.S., opportunities outside the market still seem limited.And for investors betting on a cannabis rebound, there are other, potentially more attractive options. Aphria (NYSE:APHA) has done an excellent job this year under CEO Irwin Simon, and looks like the pick in the sector. Cronos (NASDAQ:CRON), like Canopy, has a fortress balance sheet and has avoided wasting capital on potentially unprofitable production assets.I'm not recommending a short of CGC, or even necessarily that owners sell the stock. But for those who believe the cannabis sector has hit a bottom, there seem to be better places to put new money than Canopy Growth stock.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 'A'-Rated Stocks to Buy Before 2020 * 7 of the Decade's Fastest-Growing Dividend Stocks * 5 Cheap Dividend Stocks With High Yields And Annual Increases The post 3 Sin Stocks to Avoid During the Holidays appeared first on InvestorPlace.
Euro zone banks enjoyed their best day in two months on Thursday after comments by new ECB chief Christine Lagarde, and European shares were propelled further by U.S.-China trade developments. The pan-European STOXX 600 index closed up 0.3% as euro zone banks rose 2.8%, with investors taking comfort from Lagarde saying she was aware of the side effects of the European Central Bank's unconventional monetary policy.
It hoped to close the sale of Carlton & United Breweries (CUB) to Asahi in the first quarter of 2020. It also said Asahi may act as a competitive constraint on the two largest beer brewers - CUB and Lion - and has "the potential to be an even bigger threat in future".
Sentera today announced a long-term partnership with Anheuser Busch InBev SA/NV (‘AB InBev’), under which Sentera will deliver critical enabling technology for AB InBev’s SmartBarley platform which helps growers improve their productivity and secure the supply chain of the future.
Does Anheuser-Busch InBev SA/NV (NYSE:BUD) represent a good buying opportunity at the moment? Let’s quickly check the hedge fund interest towards the company. Hedge fund firms constantly search out bright intellectuals and highly-experienced employees and throw away millions of dollars on satellite photos and other research activities, so it is no wonder why they tend […]
The stock market is hitting new all-time highs. With it, many of investors' favorite stocks are becoming rather expensive. There are certainly fewer cheap value stocks today than there were last December, that's for sure.But don't despair. The rise in the S&P 500 and other stock market indexes hasn't caused all stocks to rise uniformly. Many companies have missed out on the rally. Some of these value stocks are held back by headline news, such as the trade war. Others of these value stocks are overlooked for more subtle reasons.Regardless, it's time to start sleuthing out some of the market's best holiday deals before the new year kicks off. Here are seven value stocks that need to be on your radar now.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Value Stocks to Buy: Intel (INTC)Source: Sundry Photography / Shutterstock.com Like several of the companies on this list, Intel (NASDAQ:INTC) is currently dogged by trade war concerns. The lack of certainty around the future of U.S.-China business relations puts a crimp on semiconductor spending. This has caused INTC stock to stall out just below the key $60 resistance level yet again, despite sharply improving operating metrics in recent quarters.Even as Intel stock has moved higher in recent years, the price-to-earnings ratio has failed to expand to any meaningful degree. Now, at $56 per share, Intel sells for just 12 times forward earnings. Intel's earnings, you should remember, are up from less than $2.50 per share in recent years to more than $4 per share today. Yet the market is still pricing Intel as though it were a little-to-no growth business.This idea that Intel is just a stagnant PC chip business really needs to be retired. The company has heavily invested in all sorts of new growth avenues to move beyond its legacy cash cow. Intel's strides in autonomous vehicles are particularly impressive. Yet, it still sells at a bargain-bin price. All the better for investors buying Intel stock today, however. Intel pays a healthy dividend and has bought back more than 1 billion shares of INTC stock over the course of this decade. * 7 Hot Stocks for 2020's Big Trends Sooner or later, the market will catch on to the huge earnings growth and capital return story that Intel is offering its shareholders. Wells Fargo (WFC)Source: Kristi Blokhin / Shutterstock.com Beloved by Warren Buffett and known for its sterling reputation, Wells Fargo (NYSE:WFC) used to be the cream of the banking crop. Then the scandal headlines and customer lawsuits started hitting and Wells Fargo's reputation went from outstanding to infamous virtually overnight.With it, so did Wells Fargo's valuation. Despite a roaring stock market in general and earnings growth at Wells Fargo over the past five years, WFC stock has gone absolutely nowhere. Five years ago in December, WFC stock sold for $55 per share, now it is at $54. In that time, it's gone from being highly priced to being a deep value stock.Why is it time to forgive WFC for its mistakes and buy into the story today? For one, all the old management has been cleaned out. The company has gotten rid of those with ties to the scandals and brought in highly respected former Visa (NYSE:V) CEO Charles Scharf. Two, the company is set for massive earnings growth in coming years. It is buying back 10% of its stock annually, which boosts earnings per share.Plus, Wells Fargo has billions in extra legal and compliance costs right now related to the bad customer practices of yesteryear. As those costs wind down going forward, profits will surge. Even assuming flat revenues due to the difficult interest rate environment, Wells Fargo should be able to get to $6 of EPS over the next two years, which would lead to 35% upside for the stock assuming a reasonable 12x-13x P/E ratio. Suncor (SU)Source: Kodda / Shutterstock.com Most investors hate energy stocks right now. It's not hard to see why; oil prices crashed in 2014 and have failed to meaningfully recover since then. Meanwhile natural gas has been getting more and more oversupplied with every passing year. Energy prices have been in steady retreat, so the industry has faced a calamitous downturn. Smaller exploration and production companies have been going bankrupt in droves, and things haven't been looking too good for the midstream pipeline companies either.Don't throw out the baby with the bathwater though. The major oil companies are still great investments. In fact, the longer oil prices stay down, the better the oil majors will do when the cycle finally turns up again. That's because the shortage of capital in the industry now is forcing severe layoffs and cutbacks on expansion plans. In future years, supply will drop significantly thanks to the absence of new production efforts. On top of that, the majors have been buying up assets on the cheap to take advantage of current market conditions.That's where Suncor (NYSE:SU) comes in. The Canadian integrated oil giant has been quietly building an oil sands production and refining empire over the past decade. Oil sands have become one of the world's cheapest sources of oil, with Suncor producing for just $25 per barrel or so. It also has supplies to last for many decades; oil sands, unlike shale, do not deplete quickly. Suncor's refining capacity has also insulated it from low crude oil prices in North America as it can sell higher-value gasoline and other finished petroleum products.Add it all up, and Suncor is a cash flow machine. It is offering a 12% cash flow yield, giving it room to pay a 4% dividend yield which it tends to hike by double digits every year. The company also has enough left over to both buy back stock and pay down debt. When oil prices turn up, Suncor stock will be set for a massive rally. Altria (MO)Source: Kristi Blokhin / Shutterstock.com Tobacco leader Altria (NYSE:MO) isn't quite the cheapest of value stocks, at least not compared to a month or two ago. Altria shares have recovered from $40 to $50. But don't think you're too late, Altria is still a relative bargain today. Keep in mind that MO stock traded as high as $75 per share not that long ago.It's not hard to see why Altria stock crashed. The company has seen its cigarette sales volumes decline more aggressively in recent years; the annual declines have moved from low single digits to closer to 5%. This makes it hard to keep revenues flat or increasing merely from price hikes. Altria seemingly panicked as a result, and paid way too much for its minority stake in vaping leader Juul. Investors have punished Altria mercilessly for this ill-timed blunder. As the federal government has cracked down on vaping, Juul's valuation has sunk. * 7 Retail Stocks to Buy That Dominated Thanksgiving Shopping However, the worst is over for MO stock. See, the bears can't have it both ways. If cigarette sales decline sharply, people are going to want to get nicotine from another source, of which vaping is the easiest alternative. Meanwhile, if the federal government limits vaping too much, people will simply go back to cigarettes. As long as people crave their nicotine, Altria will get its revenues one way or another. The government has seemingly realized this, and is now backing down on some of the harsher vaping rules. Molson Coors Brewing (TAP)Source: OleksandrShnuryk / Shutterstock.com If cigarettes and vaping aren't up your alley, how about beer? This brings us to Molson Coors Brewing (NYSE:TAP) which makes those namesake beer brands along with other well-known labels such as Miller and Blue Moon.The company acquired 100% ownership of Miller along with many other assets in 2016 when Anheuser-Busch InBev (NYSE:BUD) acquired SABMiller and regulators forced the combined entity to sell off some brands for antitrust reasons. Molson Coors took advantage and grabbed these assets at a seemingly favorable price. However, it took on a lot of debt to complete the deal, and combined with weak sales in recent years, its financial results have underwhelmed.This, in turn, has caused investors to dump TAP, making it one my favorite value stocks. It's down from a high of $110 to just $51 now. However, the tide is starting to turn. The balance sheet is getting stronger, and management just rewarded shareholders for their patience with a gigantic dividend hike this year.As a result, TAP stock now trades for just 12x earnings and pays a 4.5% dividend yield. The craft beer movement has already lost steam -- craft is barely taking any additional share from big beer. It's only a matter of time until Molson Coors gets revenue growth to kick in again, and the stock should move back up above 15x earnings, leading to sizable capital gains on top of the healthy dividend yield. Eastman Chemical (EMN)Source: Michael Vi / Shutterstock.com With its recent selloff, Eastman Chemical (NYSE:EMN) is back into the deep value stocks zone. EMN stock is now going for just 10x earnings. Traders have dumped shares of the former Eastman Kodak spinoff thanks to the trade war, which has caused a bit of an earnings slowdown. Eastman was originally supposed to make about $7.75 in EPS this year, now it will be closer to $7.20. Regardless, for a $75 stock, that's fantastic.Impressively, Eastman is on track to produce more than $1 billion in cash flow this year, meaning it is selling for less than 10x that metric. With all that cash, Eastman can pay a 3.3% dividend yield, buy back stock and pay down debt all at the same time. * 7 Exciting Biotech Stocks to Buy Now Investors aren't enthused for chemicals stocks right now because they are seen as cyclical. That, plus global trade concerns, have the sector in the penalty box. Make no mistake though, if this Federal Reserve easing cycle leads to any signs of an economic pick-up in 2020, these left-for-dead chemical stocks like Eastman should come roaring back. Corporacion America Airports (CAAP)Source: Shutterstock Finally, we get to the last of our value stocks, and this one is deeply under-followed. That's because Corporacion America Airports (NYSE:CAAP) is both a fairly recent initial public offering, and a company whose operations are centered in Argentina. The IPO was unfortunately timed, as Argentina's economy soon went into a tailspin after CAAP stock started trading on the New York Stock Exchange. To make matters worse, Argentina voted in a left-wing government this fall, triggering a rout on Argentine stocks.Add it all up, and CAAP stock has hit massive turbulence dumping from the IPO of $16 per share to just $4 now. Oddly enough, given the fall in stock price, the actual business is still going reasonably well. The company has a healthy balance sheet, and passenger traffic is still rising across its portfolio of airports. CAAP gets about 60% of its airport traffic from Argentine airports, but it also has major holdings in Brazil, Italy, Ecuador and various other countries. As a result, the market has now crushed CAAP stock for a 75% loss despite the fact that only 60% of its business is in Argentina. Even if Argentina goes into an economic depression, the other airports should more than support the stock price here.If the Argentina airports face a moderate decline in traffic, and the rest of the portfolio performs as is, the stock would be trading for less than 5x its earnings before interest, taxes, depreciation and amortization. That's an insane price for an airport operator -- publicly traded comparables in Mexico sell for around 12x EBITDA. European airport operators tend to sell for 15x-20x EBITDA. Currently, another emerging markets airport operator in Thailand is selling for nearly 25x. Just getting to 12x, where Mexican airports sell for, would cause CAAP stock to nearly quadruple from today's prices.There's no guarantee it will happen, but the odds favor an upturn in sentiment toward Argentina rather than a further darkening from the already-despondent mood. When things turn back up, CAAP stock should soar.At the time of this writing, Ian Bezek owned EMN, INTC, WFC, SU, CAAP, MO and TAP stock. You can reach him on Twitter at @irbezek. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Hot Stocks for 2020's Big Trends * 7 Lumbering Large-Cap Stocks to Avoid * 5 ETFs for Oodles of Monthly Dividends The post 7 Overlooked Value Stocks to Buy That Will Shine in 2020 appeared first on InvestorPlace.
The world's biggest brewer has a debt pile to match: around 100 billion dollars of it. But AB InBev's plans to pay down some of that by selling its Australia operations to Asahi may be in jeopardy. Australian regulators say a new combined entity would control two thirds of the local cider market. And could also raise competition concerns in the beer market there. AB's debt mountain stems largely from buying out rival SABMiller in 2016. The Belgian giant has been selling assets and took its Asian business public this year to raise funds. And hoped to close the 11 billion dollar sale of its Carlton & United Breweries arm in Australia in the first quarter of 2020. The deal would turn Japan's Asahi into the world number 3 - behind AB and Heineken. Regulators though say they won't make a final decision until March - one analyst told Reuters the deal's unlikely to get passed. The news left shares in both parties down over a per cent in early trading on Thursday (December 12).