Ambev SA (ABEV) AI Stock Analysis

• Market Cap: $36.82B
• Dividend Yield: 1.89%
• Average Volume (3M): 32.76M
• Price to Earnings (P/E): 14.2
• Beta (1Y): 0.19
• Revenue Growth: 1.25%
• EPS Growth: -13.02%
• Country: US
• Employees: 43,000
• Sector: Consumer Defensive
• Sector Strength: 54
• Industry: Beverages - Alcoholic
• EPS (TTM): 0.04
• Shares Outstanding: 15,761,639,000
• 10 Day Avg. Volume: 30,224,851
• 30 Day Avg. Volume: 32,758,937
• PEG Ratio: 13.15
• Price to Book (P/B): 2.21
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 9.46
• 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: $3.00
• Price Target Upside: 28.21% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 71 Outperform
• Price Target: $2.50 ▲(6.84%Upside)

The overall score reflects Ambev's strong financial performance and positive earnings outlook, which are slightly offset by challenging technical indicators and modest valuation metrics. The robust financial health and strategic focus on margin expansion are key strengths, while bearish technical signals and external market pressures pose risks.

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 S.A., through its subsidiaries, produces, distributes, and sells beer, draft beer, carbonated soft drinks, other non-alcoholic beverages, malt, and food products in the Americas. The company operates through four segments: Brazil; Central America and the Caribbean; Latin America South; and Canada. It offers beer primarily under the Skol, Brahma, Antarctica, Brahva, Brahva Gold, Extra, Bud Light, Beck, Leffe and Hoegaarden, Bucanero, Cristal, Mayabe, Cacique, Presidente, Brahma Light, Presidente Light, Presidente Golden Light, Bohemia, The One, Corona, Modelo Especial, Stella Artois, and Budweiser, Quilmes Clásica, Paceña, Taquiña, Huari, Becker, Cusqueña, Michelob Ultra, Busch, Pilsen, Ouro Fino, Banks, Deputy, Patricia, Labatt Blue, Alexander Keith's, and Kokanee brands. The company also provides bottled water, isotonic beverages, energy drinks, coconut water, powdered and natural juices, and ready-to-drink teas under the Guaraná Antarctica, Gatorade, H2OH!, Lipton Iced Tea, Fusion, Do Bem, Pepsi, Canada Dry, Squirt, Red Rock, Pepsi-Cola, Seven Up, Nutrl, Bud Light Seltzer, Palm Bay, and Mike's brands. It offers its products through a network of third-party distributors and a direct distribution system. The company was founded in 1885 and is headquartered in São Paulo, Brazil. Ambev S.A. is a subsidiary of Interbrew International B.V.

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 demonstrates strong financial health with consistent revenue and profit growth, robust profitability margins, and a solid capital structure. The company's 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	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	89.45B	79.74B	79.71B	72.85B	58.38B
Gross Profit	45.84B	40.45B	39.29B	37.19B	31.31B
EBITDA	26.72B	23.46B	23.08B	22.87B	20.77B
Net Income	14.44B	14.50B	14.46B	12.67B	11.38B
Balance Sheet
Total Assets	162.51B	132.64B	137.96B	138.60B	125.20B
Cash, Cash Equivalents and Short-Term Investments	29.84B	16.34B	15.38B	18.54B	18.79B
Total Debt	3.45B	3.50B	3.85B	3.10B	4.79B
Total Liabilities	62.93B	52.50B	54.63B	54.58B	50.05B
Stockholders Equity	98.64B	78.97B	81.96B	82.64B	73.82B
Cash Flow
Free Cash Flow	21.35B	18.71B	14.11B	15.22B	14.16B
Operating Cash Flow	26.10B	24.71B	20.64B	22.90B	18.86B
Investing Cash Flow	-5.46B	-5.77B	-5.00B	-7.73B	-6.80B
Financing Cash Flow	-10.35B	-16.12B	-16.34B	-16.04B	-8.60B

Ambev SA Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2.34
• 50DMA: Negative
• 100DMA: Negative
• 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 Negative. The current price of 2.34 is below the 20-day moving average (MA) of 2.39, below the 50-day MA of 2.43, and above the 200-day MA of 2.17, indicating a neutral trend. The MACD of -0.02 indicates Positive momentum. The RSI at 44.46 is Neutral, neither overbought nor oversold. The STOCH value of 32.78 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ABEV.

Ambev SA Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BUD	74 Outperform	$131.78B	22.74	7.31%	1.57%	0.58%	9.94%
ABEV	71 Outperform	$36.82B	14.16	15.09%	1.89%	1.25%	-13.02%
CCU	71 Outperform	$2.18B	12.36	11.33%	3.89%	6.18%	61.39%
TAP	69 Neutral	$10.13B	10.04	7.90%	3.65%	-5.17%	-0.74%
STZ	68 Neutral	$30.43B	49.10	-5.05%	2.35%	-0.47%	-117.62%
FMX	60 Neutral	$18.86B	21.16	6.88%	4.89%	-2.73%	-37.93%
Sector *	51 Neutral	AU$2.25B	-0.40	-12.78%	11.26%	8.02%	-57.98%