Fomento Economico Mexicano (FMX) AI Stock Analysis

• Market Cap: $21.51B
• Dividend Yield: 4.33%
• Average Volume (3M): 384.45K
• Price to Earnings (P/E): 48.4
• Beta (1Y): 0.25
• Revenue Growth: 1.44%
• EPS Growth: -38.87%
• Country: US
• Employees: 394,010
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Beverages - Alcoholic
• EPS (TTM): 0.40
• Shares Outstanding: 201,518,510
• 10 Day Avg. Volume: 473,519
• 30 Day Avg. Volume: 384,449
• 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: 783.51
• Enterprise Value/Revenue: 20.36
• Enterprise Value/Gross Profit: 49.47
• Enterprise Value/Ebitda: 139.68
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 5.57
• Revenue Forecast (FY): $50.82B

• Rating: 65 Neutral
• Price Target: $112.00 ▲(7.32% 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

Strong Revenue Growth

A near-doubling of TTM revenue signals durable top-line momentum driven by broad geographic exposure and core beverage retail channels. Sustained revenue growth supports scale advantages, funds reinvestment in distribution and capacity, and underpins multi-year expansion of Proximity and Coca‑Cola operations.

Healthy Gross Margins

A ~41% gross margin reflects structural cost efficiency in production and distribution, benefiting from scale as a major Coca‑Cola bottler and OXXO retail footprint. Stable gross margins provide a lasting buffer against commodity swings and support reinvestment and margin recovery at the operating-profit level over the medium term.

Diversified portfolio & disciplined capital returns

Strategic asset sales and a clear capital distribution plan demonstrate disciplined capital allocation and portfolio reshaping. Diversification across beverages, retail, and digital payments reduces single-market cyclicality, while targeted reinvestment in bottling and Proximity supports sustained competitive positioning.

Negative Factors

Increased Leverage

Higher leverage raises persistent financial risk by increasing interest burden and reducing balance sheet flexibility. Elevated debt levels can limit capital allocation choices, heighten refinancing risk in tighter credit conditions, and constrain the company's ability to fund investments or cushion cyclical downturns.

Low Net Profit Margin

A single-digit net margin despite healthy gross margins indicates structural pressure from nonoperating items, interest costs, and FX losses. Persistently low net profitability limits retained earnings for capex and debt reduction and reduces resilience to shocks or prolonged operating headwinds.

Weak Cash Conversion

Low cash conversion ratios show earnings are not fully translating into cash, constraining debt paydown and sustainable distributions. Even with positive FCF growth, weak conversion increases reliance on external financing for capex or buybacks and raises sensitivity to working-capital swings over the medium term.

Fomento Economico Mexicano Business Overview & Revenue Model

Company Description

Fomento Económico Mexicano, S.A.B. de C.V., through its subsidiaries, operates as a bottler of Coca-Cola trademark beverages. The company produces, markets, and distributes Coca-Cola trademark beverages in Mexico, Guatemala, Nicaragua, Costa Rica, Panama, Colombia, Venezuela, Brazil, Argentina, and Uruguay. It also operates small-box retail chain stores in Mexico, Colombia, Peru, Chile, and Brazil under the OXXO name; retail service stations for fuels, motor oils, lubricants, and car care products under the OXXO GAS name in Mexico; and drugstores in Chile, Colombia, Ecuador, and Mexico under the Cruz Verde, Fybeca, SanaSana, YZA, La Moderna, and Farmacon names. In addition, the company is involved in the production and distribution of chillers, commercial refrigeration equipment, plastic boxes, food processing, and preservation and weighing equipment; and provision of logistic transportation, distribution and maintenance, point-of-sale refrigeration, and plastics solutions, as well as distribution platform for cleaning products and consumables. As of December 31, 2021, it operated 20,431 OXXO stores; 3,652 drugstores; and 567 OXXO GAS service stations. Fomento Económico Mexicano, S.A.B. de C.V. was founded in 1890 and is based in Monterrey, Mexico.

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 demonstrates strong revenue growth and operational efficiency, with solid EBIT and EBITDA margins. However, the net profit margin is relatively low, and the increased leverage in the TTM period poses a potential risk. Cash flow generation is improving, but there is room for better conversion of income into cash. Overall, the company is in a stable financial position with opportunities for enhancing profitability and cash flow efficiency.

Income Statement

Fomento Economico Mexicano shows strong revenue growth in the TTM period with a 97.7% increase, indicating robust sales performance. The gross profit margin remains healthy at 41.27%, reflecting efficient cost management. However, the net profit margin is relatively low at 3.13%, suggesting room for improvement in profitability. The EBIT and EBITDA margins are solid, indicating good operational efficiency.

Balance Sheet

The company's debt-to-equity ratio of 1.10 in the TTM period indicates a moderate level of leverage, which is higher than previous years, suggesting increased financial risk. Return on equity is stable at 8.84%, showing consistent shareholder returns. The equity ratio is not provided, but the overall balance sheet reflects a stable financial position with manageable debt levels.

Cash Flow

The free cash flow growth rate is positive at 10.55%, indicating improved cash generation. However, the operating cash flow to net income ratio is low at 0.26, suggesting potential issues in converting income into cash. The free cash flow to net income ratio is 0.30, showing moderate cash flow efficiency.

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: 104.36
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

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 104.36 is above the 20-day moving average (MA) of 103.99, above the 50-day MA of 100.83, and above the 200-day MA of 95.02, indicating a bullish trend. The MACD of 1.94 indicates Negative momentum. The RSI at 59.77 is Neutral, neither overbought nor oversold. The STOCH value of 61.50 is Neutral, 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	$46.02B	16.11	15.97%	8.22%	-0.68%	4.29%
BUD	75 Outperform	$148.93B	20.42	8.97%	1.83%	-2.06%	21.03%
CCU	70 Outperform	$2.67B	19.39	9.07%	2.53%	16.59%	1.72%
STZ	66 Neutral	$28.90B	25.33	14.29%	2.92%	-5.57%	119.49%
FMX	65 Neutral	$21.51B	48.39	5.48%	4.33%	1.44%	-38.87%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%
TAP	53 Neutral	$10.13B	―	-17.66%	4.08%	-4.01%	-339.22%

Fomento Economico Mexicano Corporate Events

FEMSA Takes Full Control of OXXO Convenience Operations in Brazil After Grupo Nós Split

On February 2, 2026, FEMSA completed the separation of its Grupo Nós joint venture in Brazil with Raízen S.A., resulting in FEMSA assuming full ownership and operational control of the OXXO convenience stores in Brazil and the associated distribution center in Cajamar, São Paulo. The remaining Grupo Nós assets and liabilities were divided between FEMSA and Raízen according to their respective business lines, a move that streamlines FEMSA’s Brazilian retail footprint and reinforces its strategic focus on expanding the OXXO brand in the Brazilian market while potentially clarifying responsibilities and risk allocation for both partners in the country’s competitive convenience retail sector.

The most recent analyst rating on (FMX) stock is a Hold with a $112.00 price target. To see the full list of analyst forecasts on Fomento Economico Mexicano stock, see the FMX Stock Forecast page.

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.

The most recent analyst rating on (FMX) stock is a Hold with a $101.00 price target. To see the full list of analyst forecasts on Fomento Economico Mexicano stock, see the FMX Stock Forecast page.