Ambev SA (ABEV) AI Stock Analysis

• Market Cap: $37.82B
• Dividend Yield: 3.71%
• Average Volume (3M): 28.85M
• Price to Earnings (P/E): 14.5
• Beta (1Y): 0.19
• Revenue Growth: 1.25%
• EPS Growth: -13.02%
• Country: US
• Employees: 43,000
• Sector: Consumer Defensive
• Sector Strength: 55
• Industry: Beverages - Alcoholic
• EPS (TTM): 0.04
• Shares Outstanding: 15,761,639,000
• 10 Day Avg. Volume: 40,304,679
• 30 Day Avg. Volume: 28,846,336
• PEG Ratio: 1.15
• Price to Book (P/B): 2.76
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 16.04
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $2.91
• Price Target Upside: 23.31% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 4

• Rating: 78 Outperform
• Price Target: $3.00 ▲(27.12%Upside)

Ambev SA shows strong financial performance with consistent revenue growth and robust profitability margins. The technical analysis indicates a positive momentum, while the valuation is fair with a strong dividend yield. Despite some challenges highlighted in the earnings call, the company maintains a positive outlook with strategic expansions and margin improvements.

Positive Factors

Capital Allocation

The shift to more frequent cash returns by Ambev could enhance visibility on capital allocation and potentially support the shares.

Market Positioning

Higher beer prices present an opportunity for Ambev to strengthen its position in the mainstream category and potentially gain market share.

Valuation

Ambev's stock is considered to be trading at an attractive 7% free cash flow yield, suggesting a potentially good investment opportunity.

Negative Factors

Cost Pressures

Potential increases in costs due to higher aluminum prices and currency depreciation pose a risk to Ambev.

Dividend Expectations

The announced dividends and interest-on-capital payments were below estimates and consensus, which could disappoint investors.

Ambev SA Business Overview & Revenue Model

Company Description

Ambev SA (ABEV) is a leading beverage company in Latin America, headquartered in São Paulo, Brazil. It operates primarily in the beer, soft drinks, and non-alcoholic beverages sectors. Ambev is known for producing, distributing, and selling a wide range of products, including popular brands like Skol, Brahma, Antarctica, and international brands such as Budweiser, Stella Artois, and Corona. The company is part of Anheuser-Busch InBev, one of the largest brewing companies globally, and it serves markets across Latin America, including Brazil, Argentina, and several other countries.

How the Company Makes Money

Ambev SA generates revenue primarily through the production, distribution, and sale of alcoholic and non-alcoholic beverages. The company's primary revenue streams include the sale of its extensive portfolio of beer brands, which account for the majority of its income. In addition to beer, Ambev also earns from selling soft drinks, energy drinks, and bottled water. The company benefits from its large distribution network and established market presence, allowing it to reach a broad customer base across Latin America. Strategic partnerships and brand licensing agreements, particularly with global brands such as Budweiser and Corona, further enhance its revenue potential. Additionally, Ambev's integration within Anheuser-Busch InBev provides synergies in procurement, distribution, and marketing, contributing to its profitability.

Ambev SA Financial Statement Overview

Summary

Ambev SA exhibits strong financial health with consistent revenue and profit growth, robust profitability margins, and a solid capital structure. The low leverage and strong equity position provide financial stability, while efficient cash flow management supports operational flexibility.

Income Statement

Ambev SA shows strong financial performance with consistent revenue growth and high profitability margins. The Gross Profit Margin stands at 51.5% for TTM, indicating efficient cost management. The Net Profit Margin is robust at 15.7%, reflecting healthy bottom-line performance. Revenue has grown by 2.5% from 2024 to TTM, demonstrating steady market expansion. EBIT and EBITDA margins are strong at 24.7% and 29.5% respectively, highlighting operational efficiency.

Balance Sheet

The company maintains a solid balance sheet with a low Debt-to-Equity Ratio of 0.03, indicating low financial leverage and strong equity position. Return on Equity is healthy at 15.3%, showcasing effective use of shareholder capital. The Equity Ratio is 64.2%, reflecting a strong capital structure with a large proportion of assets financed by equity.

Cash Flow

Ambev SA demonstrates solid cash flow management with a 3.2% Free Cash Flow Growth Rate, ensuring liquidity and operational flexibility. The Operating Cash Flow to Net Income Ratio is 1.84, indicating strong cash conversion from earnings. Free Cash Flow to Net Income Ratio is at 1.53, signifying efficient cash flow generation relative to net profits.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	91.67B	89.45B	79.74B	79.71B	72.85B	58.38B
Gross Profit	47.17B	45.84B	40.45B	39.29B	37.19B	31.31B
EBITDA	27.06B	26.72B	23.46B	23.08B	22.87B	20.77B
Net Income	14.43B	14.44B	14.50B	14.46B	12.67B	11.38B
Balance Sheet
Total Assets	147.30B	162.51B	132.64B	137.96B	138.60B	125.20B
Cash, Cash Equivalents and Short-Term Investments	20.31B	29.84B	16.34B	15.38B	18.54B	18.79B
Total Debt	3.22B	3.45B	3.50B	3.85B	3.10B	4.79B
Total Liabilities	51.82B	62.93B	52.50B	54.63B	54.58B	50.05B
Stockholders Equity	94.53B	98.64B	78.97B	81.96B	82.64B	73.82B
Cash Flow
Free Cash Flow	22.02B	21.35B	18.71B	14.11B	15.22B	14.16B
Operating Cash Flow	26.58B	26.10B	24.71B	20.64B	22.90B	18.86B
Investing Cash Flow	-4.47B	-5.46B	-5.77B	-5.00B	-7.73B	-6.80B
Financing Cash Flow	-16.88B	-10.35B	-16.12B	-16.34B	-16.04B	-8.60B

Ambev SA Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 2.36
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ABEV, the sentiment is Neutral. The current price of 2.36 is below the 20-day moving average (MA) of 2.43, below the 50-day MA of 2.46, and above the 200-day MA of 2.16, indicating a neutral trend. The MACD of -0.03 indicates Positive momentum. The RSI at 40.26 is Neutral, neither overbought nor oversold. The STOCH value of 27.78 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ABEV.

Ambev SA Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BUD	79 Outperform	$136.61B	23.43	7.31%	1.53%	0.64%	10.02%
ABEV	78 Outperform	$37.82B	14.53	15.09%	3.71%	1.25%	-13.02%
FMX	73 Outperform	$21.05B	21.22	9.84%	1.79%	-0.37%	44.52%
CCU	71 Outperform	$2.42B	13.68	11.33%	3.35%	6.18%	61.39%
TAP	65 Neutral	$9.64B	9.54	7.90%	3.96%	-5.17%	-0.74%
Sector *	65 Neutral	$26.91B	15.06	-4.01%	3.23%	1.02%	2.11%
STZ	61 Neutral	$28.54B	49.10	-0.98%	2.53%	2.47%	-105.09%