Fomento Economico Mexicano (FMX) AI Stock Analysis

• Market Cap: $20.78B
• Dividend Yield: 4.28%
• Average Volume (3M): 361.39K
• Price to Earnings (P/E): 45.1
• Beta (1Y): 0.29
• Revenue Growth: 1.44%
• EPS Growth: -38.87%
• Country: US
• Employees: 394,010
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Beverages - Alcoholic
• EPS (TTM): 0.38
• Shares Outstanding: 214,845,300
• 10 Day Avg. Volume: 391,348
• 30 Day Avg. Volume: 361,392
• PEG Ratio: -0.04
• Price to Book (P/B): 0.21
• Price to Sales (P/S): 0.07
• P/FCF Ratio: 2.15
• Enterprise Value/Market Cap: 2.16
• Enterprise Value/Revenue: 0.05
• Enterprise Value/Gross Profit: 0.13
• Enterprise Value/Ebitda: 0.37
• 1Y Price Target: $106.00
• Price Target Upside: 10.88% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): 4.4
• Revenue Forecast (FY): $45.73B

• Rating: 65 Neutral
• Price Target: $101.00 ▲(5.65% Upside)

Fomento Economico Mexicano's overall stock score is driven by strong financial performance, particularly in revenue growth and operational efficiency, despite a low net profit margin and increased leverage. The technical analysis indicates a stable trend with no significant momentum, while the valuation suggests the stock may be overvalued, offset by an attractive dividend yield. The earnings call sentiment is neutral, with balanced achievements and challenges.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust demand and effective market strategies, enhancing long-term business sustainability and competitiveness.

Strategic Expansion

Full control of OXXO stores in Brazil allows for strategic expansion in a high-growth market, potentially increasing market share and operational efficiency.

Digital Ecosystem Growth

Expansion of the digital payment platform enhances customer engagement and financial inclusion, supporting long-term growth in digital services.

Negative Factors

Profitability Challenges

Decreasing net profit margins indicate pressure on profitability, which could affect long-term financial health and investment capacity if not addressed.

Increased Financial Leverage

Higher leverage increases financial risk and may limit flexibility in capital allocation, potentially impacting long-term strategic initiatives.

Traffic Decline in OXXO Mexico

Declining store traffic in key markets like Mexico can hinder revenue growth and indicate challenges in consumer engagement or competitive positioning.

Fomento Economico Mexicano Business Overview & Revenue Model

Company Description

Fomento Economico Mexicano (FMX) is a leading Mexican company primarily focused on the beverage industry, particularly in the production and distribution of soft drinks, bottled water, and snacks. As a major bottler and distributor of Coca-Cola products in Mexico and Central America, FMX operates in sectors including beverages, retail, and food products. The company's diverse portfolio also includes convenience stores and various food and beverage brands, positioning it as a significant player in the regional market.

How the Company Makes Money

FMX generates revenue primarily through the sale of beverages, including soft drinks, bottled water, and flavored drinks, which contribute significantly to its earnings. The company operates on a business model that combines direct sales to retailers and distributors alongside its extensive network of convenience stores, where it also sells snacks and other food items. Key revenue streams include the sale of Coca-Cola products, which are sold under franchise agreements, as well as the operation of its own brand products. Additionally, FMX benefits from strategic partnerships with major brands and suppliers, enhancing its distribution capabilities and market reach. Its ability to innovate and adapt to consumer preferences in the beverage and food sectors also plays a crucial role in driving revenue growth.

Fomento Economico Mexicano Financial Statement Overview

Summary

Fomento Economico Mexicano shows strong revenue growth and a solid asset base, but faces challenges with profitability margins and increased financial leverage. Cash flow generation has improved, yet efficiency in cash conversion remains an area for improvement. Overall, the financial health is stable with room for enhancing profitability and managing leverage.

Income Statement

Fomento Economico Mexicano shows a strong revenue growth trajectory, with a notable increase in gross profit margins over the years, reaching 41.27% in TTM. However, the net profit margin has slightly decreased to 3.13% in TTM from 3.42% in 2024, indicating some pressure on profitability. The EBIT and EBITDA margins have also seen a decline in TTM, suggesting potential operational challenges.

Balance Sheet

The company's debt-to-equity ratio has increased to 1.10 in TTM, indicating higher leverage, which could pose financial risks. However, the equity ratio remains stable, and the return on equity, although slightly reduced, is still healthy at 8.84% in TTM. The balance sheet reflects a solid asset base but with increased financial leverage.

Cash Flow

The cash flow statement shows a positive free cash flow growth rate of 12.86% in TTM, indicating improved cash generation capabilities. However, the operating cash flow to net income ratio has decreased, suggesting less efficiency in converting income into cash. The free cash flow to net income ratio also reflects a moderate level of cash flow relative to earnings.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	827.78B	890.08B	685.68B	581.76B	562.57B	456.33B
Gross Profit	340.76B	363.22B	270.72B	232.92B	213.67B	173.54B
EBITDA	120.67B	139.03B	105.43B	88.22B	84.60B	58.52B
Net Income	15.36B	25.70B	64.04B	23.30B	28.82B	-1.79B
Balance Sheet
Total Assets	44.07B	851.54B	805.86B	798.82B	737.50B	34.37B
Cash, Cash Equivalents and Short-Term Investments	6.74B	183.05B	191.84B	83.49B	121.82B	5.44B
Total Debt	14.05B	256.30B	232.90B	285.06B	252.94B	12.39B
Total Liabilities	26.21B	470.40B	427.49B	461.01B	402.38B	18.95B
Stockholders Equity	13.38B	297.50B	303.86B	262.60B	262.60B	11.93B
Cash Flow
Free Cash Flow	20.57B	28.80B	11.56B	41.10B	52.79B	33.03B
Operating Cash Flow	52.70B	72.49B	49.68B	72.58B	73.09B	53.17B
Investing Cash Flow	-26.18B	-33.12B	132.29B	-46.43B	-46.17B	-31.37B
Financing Cash Flow	-53.83B	-84.05B	-92.55B	-35.90B	-36.99B	19.57B

Fomento Economico Mexicano Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 95.60
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FMX, the sentiment is Positive. The current price of 95.6 is below the 20-day moving average (MA) of 97.16, above the 50-day MA of 95.38, and above the 200-day MA of 94.63, indicating a bullish trend. The MACD of 2.24 indicates Negative momentum. The RSI at 70.29 is Negative, neither overbought nor oversold. The STOCH value of 90.55 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FMX.

Fomento Economico Mexicano Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ABEV	80 Outperform	$39.50B	13.72	15.97%	7.00%	-0.68%	4.29%
BUD	75 Outperform	$121.82B	16.99	8.97%	1.94%	-2.06%	21.03%
CCU	70 Outperform	$2.43B	16.98	9.07%	2.48%	16.59%	1.72%
STZ	67 Neutral	$24.72B	20.73	15.91%	2.74%	-5.57%	119.49%
FMX	65 Neutral	$20.78B	45.08	5.48%	4.28%	1.44%	-38.87%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
TAP	53 Neutral	$9.22B	―	-17.66%	4.01%	-4.01%	-339.22%

Fomento Economico Mexicano Corporate Events

FEMSA Initiates $260 Million Accelerated Share Repurchase

On December 2, 2025, FEMSA announced it has entered into an accelerated share repurchase (ASR) agreement with a U.S. financial institution to buy back $260 million worth of its American Depositary Shares (ADS). This move aligns with FEMSA’s capital allocation strategy to enhance shareholder returns. The ASR agreement includes an initial delivery of 540,035 ADSs on December 3, 2025, with the final settlement expected by the first quarter of 2026. This strategic financial maneuver is likely to impact FEMSA’s market positioning by potentially increasing shareholder value and demonstrating the company’s commitment to efficient capital management.

FEMSA Reports Strong Q3 2025 Results Amid Market Challenges

On October 28, 2025, FEMSA reported its third-quarter financial results, highlighting a 9.1% increase in total consolidated revenues and a 4.3% rise in income from operations compared to the same period in 2024. The company’s retail segment, particularly Proximity Americas, showed significant growth with a 9.2% increase in revenues. Additionally, the digital payment platform Spin by OXXO expanded its user base by 20.5%. Despite challenges in the Mexican market, FEMSA’s diversified operations in South America and Europe helped mitigate local market softness. The company remains optimistic about future growth, especially with upcoming events like the FIFA World Cup and Coca-Cola’s 100th anniversary in Mexico.

FEMSA Reports Strong Revenue Growth in First Half of 2025

Fomento Económico Mexicano, S.A.B. de C.V. (FEMSA) reported its financial results for the first half of 2025, showing an increase in total revenues to U.S. $21,606 million compared to the same period in 2024. The company experienced growth in gross profit and managed to maintain steady operations despite challenges such as fluctuating raw material prices and changes in economic conditions. These results reflect FEMSA’s resilience and strategic positioning in the market, which could have positive implications for its stakeholders.

FEMSA Announces New CEO Appointment Effective November 2025

On September 17, 2025, FEMSA announced a leadership transition, appointing Jose Antonio Fernández Garza-Lagüera as the new CEO, effective November 1, 2025. This decision follows a comprehensive succession planning process led by FEMSA’s Board of Directors and a Special Committee. José Antonio Fernández Carbajal, who served as interim CEO since July 2023, will continue as Executive Chairman. The transition is expected to guide FEMSA into a new phase of growth and innovation, emphasizing economic and social value creation.