Market Overview

This BUD's For You; Argus Goes Bullish For Anheuser Busch

Share:
This BUD's For You; Argus Goes Bullish For Anheuser Busch

Analysts at Argus Research acknowledge that Anheuser Busch Inbev NV (ADR) (NYSE: BUD)'s days of meaningful growth have likely passed but that doesn't mean the stock is not a good addition to an investor's portfolio. The firm's Stephen Biggar and Phil Seligman initiates coverage of AB-InBev's stock rating with a Buy rating and a 12-month price target of $136.

AB-InBev is the world's biggest beer brewer with a 26 percent global market share which is more than double the second place ranked Heineken who boasts a 10 percent market share, the analysts commented in their initiation note. As such, it is always difficult for any global behemoth to show meaningful growth indefinitely but the company's organic revenue growth in the first half of 2017 was impressive and signals that ongoing "modest" acceleration is sustainable.

The beer company should show continued improvements in EBITDA and EBITDA margins, especially as the company looks to tackle under-penetrated markets, especially those in emerging regions, the analysts argued. On top of that, a rise in worldwide demand for premium peers and growth in "near-beer" and nonalcoholic beverages will contribute to the growth story as well.

Over the long-term these factors will result in a mid-single digit revenue profile with "relatively slower" growth in North America and Western Europe but faster growth in emerging markets, the analysts added.

Finally, M&A deals played a vital role in turning AB-InBev to the global giant that it is today so investors shouldn't be surprised to see more deals over time. Also, the stock's 3.4-percent dividend yield merely adds another layer of appeal for investors, especially those who fall in the income-orientated category.

Related Links:

Cultural Democracy: The 7 Best And Worst Beers According To The Layman's Palate

Politics' Push And Pull On The Alcohol Industry

Latest Ratings for BUD

DateFirmActionFromTo
Oct 2020JefferiesUpgradesHoldBuy
Jul 2020Evercore ISI GroupUpgradesIn-LineOutperform
May 2020CFRAMaintainsHold

View More Analyst Ratings for BUD
View the Latest Analyst Ratings

 

Related Articles (BUD)

View Comments and Join the Discussion!

Posted-In: AB InBev BeerAnalyst Color Long Ideas Price Target Initiation Analyst Ratings Trading Ideas Best of Benzinga

Latest Ratings

StockFirmActionPT
INTCJP MorganMaintains70.0
STMCanaccord GenuityMaintains47.0
ELDeutsche BankMaintains248.0
UAADeutsche BankMaintains13.0
INTCDeutsche BankMaintains55.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com