AMBEV SA-ADR (ABEV) Stock Fundamental Analysis
NYSE:ABEV - New York Stock Exchange, Inc. - US02319V1035 - ADR - Currency: USD
ABEV gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 33 industry peers in the Beverages industry. While ABEV belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. ABEV is valued quite cheap, while showing a decent growth score. This is a good combination! These ratings could make ABEV a good candidate for value investing.
1. Profitability
1.1 Basic Checks
In the past year ABEV was profitable.
In the past year ABEV had a positive cash flow from operations.
In the past 5 years ABEV has always been profitable.
In the past 5 years ABEV always reported a positive cash flow from operatings.
1.2 Ratios
ABEV has a Return On Assets of 9.80%. This is in the better half of the industry: ABEV outperforms 78.79% of its industry peers.
ABEV has a better Return On Equity (15.27%) than 60.61% of its industry peers.
Looking at the Return On Invested Capital, with a value of 18.50%, ABEV belongs to the top of the industry, outperforming 90.91% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for ABEV is significantly above the industry average of 11.35%.
The 3 year average ROIC (17.11%) for ABEV is below the current ROIC(18.50%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.8% | ||
| ROE | 15.27% | ||
| ROIC | 18.5% |
ROA(3y)10.1%
ROA(5y)9.71%
ROE(3y)16.88%
ROE(5y)16.28%
ROIC(3y)17.11%
ROIC(5y)16.49%
1.3 Margins
ABEV has a Profit Margin of 15.74%. This is amongst the best in the industry. ABEV outperforms 84.85% of its industry peers.
In the last couple of years the Profit Margin of ABEV has declined.
ABEV has a Operating Margin of 24.80%. This is in the better half of the industry: ABEV outperforms 78.79% of its industry peers.
In the last couple of years the Operating Margin of ABEV has declined.
ABEV's Gross Margin of 51.46% is fine compared to the rest of the industry. ABEV outperforms 63.64% of its industry peers.
ABEV's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 24.8% | ||
| PM (TTM) | 15.74% | ||
| GM | 51.46% |
OM growth 3Y0.69%
OM growth 5Y-5.02%
PM growth 3Y-2.46%
PM growth 5Y-6.55%
GM growth 3Y0.12%
GM growth 5Y-2.55%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ABEV is destroying value.
ABEV has about the same amout of shares outstanding than it did 1 year ago.
ABEV has about the same amout of shares outstanding than it did 5 years ago.
ABEV has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 4.19 indicates that ABEV is not in any danger for bankruptcy at the moment.
With a decent Altman-Z score value of 4.19, ABEV is doing good in the industry, outperforming 75.76% of the companies in the same industry.
The Debt to FCF ratio of ABEV is 0.15, which is an excellent value as it means it would take ABEV, only 0.15 years of fcf income to pay off all of its debts.
ABEV has a better Debt to FCF ratio (0.15) than 84.85% of its industry peers.
ABEV has a Debt/Equity ratio of 0.02. This is a healthy value indicating a solid balance between debt and equity.
With an excellent Debt to Equity ratio value of 0.02, ABEV belongs to the best of the industry, outperforming 81.82% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.02 | ||
| Debt/FCF | 0.15 | ||
| Altman-Z | 4.19 |
ROIC/WACC0.96
WACC19.22%
2.3 Liquidity
A Current Ratio of 1.11 indicates that ABEV should not have too much problems paying its short term obligations.
ABEV has a Current ratio of 1.11. This is in the lower half of the industry: ABEV underperforms 60.61% of its industry peers.
ABEV has a Quick Ratio of 1.11. This is a bad value and indicates that ABEV is not financially healthy enough and could expect problems in meeting its short term obligations.
ABEV has a Quick ratio of 0.80. This is comparable to the rest of the industry: ABEV outperforms 48.48% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.11 | ||
| Quick Ratio | 0.8 |
3. Growth
3.1 Past
ABEV shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -1.61%.
ABEV shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 3.40% yearly.
The Revenue has grown by 15.34% in the past year. This is quite good.
The Revenue has been growing by 11.46% on average over the past years. This is quite good.
EPS 1Y (TTM)-1.61%
EPS 3Y3.53%
EPS 5Y3.4%
EPS Q2Q%2.17%
Revenue 1Y (TTM)15.34%
Revenue growth 3Y7.08%
Revenue growth 5Y11.46%
Sales Q2Q%10.95%
3.2 Future
Based on estimates for the next years, ABEV will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.80% on average per year.
ABEV is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.91% yearly.
EPS Next Y13.11%
EPS Next 2Y9.14%
EPS Next 3Y8.79%
EPS Next 5Y10.8%
Revenue Next Year9.13%
Revenue Next 2Y7.14%
Revenue Next 3Y6.42%
Revenue Next 5Y6.91%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 15.38, the valuation of ABEV can be described as correct.
Based on the Price/Earnings ratio, ABEV is valued cheaply inside the industry as 81.82% of the companies are valued more expensively.
ABEV's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.30.
With a Price/Forward Earnings ratio of 12.69, ABEV is valued correctly.
Based on the Price/Forward Earnings ratio, ABEV is valued cheaper than 90.91% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.06, ABEV is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.38 | ||
| Fwd PE | 12.69 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ABEV indicates a rather cheap valuation: ABEV is cheaper than 90.91% of the companies listed in the same industry.
ABEV's Price/Free Cash Flow ratio is rather cheap when compared to the industry. ABEV is cheaper than 90.91% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.83 | ||
| EV/EBITDA | 6.62 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
ABEV has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.17
PEG (5Y)4.53
EPS Next 2Y9.14%
EPS Next 3Y8.79%
5. Dividend
5.1 Amount
With a yearly dividend of 0.91%, ABEV is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 2.92, ABEV has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.38, ABEV's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.91% |
5.2 History
The dividend of ABEV decreases each year by -12.44%.
ABEV has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)-12.44%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
ABEV pays out 73.84% of its income as dividend. This is not a sustainable payout ratio.
DP73.84%
EPS Next 2Y9.14%
EPS Next 3Y8.79%
2.46
-0.01 (-0.4%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryBeverages
Earnings (Last)
Earnings (Next)
Inst Owners7.23%
Inst Owner Change-23.97%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap38.45B
Analysts71.3
Price Target2.54 (3.25%)
Short Float %1.21%
Short Ratio1.69
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.91% |
Yearly Dividend0.05
Dividend Growth(5Y)-12.44%
DP73.84%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.8%
Min EPS beat(2)-4.34%
Max EPS beat(2)7.94%
EPS beat(4)1
Avg EPS beat(4)-3.87%
Min EPS beat(4)-11.29%
Max EPS beat(4)7.94%
EPS beat(8)3
Avg EPS beat(8)-1.13%
EPS beat(12)7
Avg EPS beat(12)7.04%
EPS beat(16)10
Avg EPS beat(16)10.74%
Revenue beat(2)1
Avg Revenue beat(2)-0.88%
Min Revenue beat(2)-3.37%
Max Revenue beat(2)1.61%
Revenue beat(4)2
Avg Revenue beat(4)-1.4%
Min Revenue beat(4)-3.87%
Max Revenue beat(4)1.61%
Revenue beat(8)2
Avg Revenue beat(8)-4.46%
Revenue beat(12)3
Avg Revenue beat(12)-3.62%
Revenue beat(16)6
Avg Revenue beat(16)-2.08%
PT rev (1m)1.56%
PT rev (3m)-0.49%
EPS NQ rev (1m)0.08%
EPS NQ rev (3m)10.1%
EPS NY rev (1m)-0.22%
EPS NY rev (3m)1.85%
Revenue NQ rev (1m)1.23%
Revenue NQ rev (3m)4.9%
Revenue NY rev (1m)0.11%
Revenue NY rev (3m)4.59%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.38 | ||
| Fwd PE | 12.69 | ||
| P/S | 2.36 | ||
| P/FCF | 9.83 | ||
| P/OCF | 8.14 | ||
| P/B | 2.29 | ||
| P/tB | 5.38 | ||
| EV/EBITDA | 6.62 |
EPS(TTM)0.16
EY6.5%
EPS(NY)0.19
Fwd EY7.88%
FCF(TTM)0.25
FCFY10.17%
OCF(TTM)0.3
OCFY12.28%
SpS1.04
BVpS1.07
TBVpS0.46
PEG (NY)1.17
PEG (5Y)4.53
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.8% | ||
| ROE | 15.27% | ||
| ROCE | 21.06% | ||
| ROIC | 18.5% | ||
| ROICexc | 22.78% | ||
| ROICexgc | 59.82% | ||
| OM | 24.8% | ||
| PM (TTM) | 15.74% | ||
| GM | 51.46% | ||
| FCFM | 24.02% |
ROA(3y)10.1%
ROA(5y)9.71%
ROE(3y)16.88%
ROE(5y)16.28%
ROIC(3y)17.11%
ROIC(5y)16.49%
ROICexc(3y)21.47%
ROICexc(5y)20.62%
ROICexgc(3y)60.94%
ROICexgc(5y)58.16%
ROCE(3y)19.48%
ROCE(5y)18.77%
ROICexcg growth 3Y12.62%
ROICexcg growth 5Y3.42%
ROICexc growth 3Y6.91%
ROICexc growth 5Y0.69%
OM growth 3Y0.69%
OM growth 5Y-5.02%
PM growth 3Y-2.46%
PM growth 5Y-6.55%
GM growth 3Y0.12%
GM growth 5Y-2.55%
F-Score8
Asset Turnover0.62
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.02 | ||
| Debt/FCF | 0.15 | ||
| Debt/EBITDA | 0.07 | ||
| Cap/Depr | 63.29% | ||
| Cap/Sales | 4.98% | ||
| Interest Coverage | 27.2 | ||
| Cash Conversion | 88.8% | ||
| Profit Quality | 152.61% | ||
| Current Ratio | 1.11 | ||
| Quick Ratio | 0.8 | ||
| Altman-Z | 4.19 |
F-Score8
WACC19.22%
ROIC/WACC0.96
Cap/Depr(3y)89.96%
Cap/Depr(5y)100.59%
Cap/Sales(3y)7.01%
Cap/Sales(5y)7.92%
Profit Quality(3y)124.82%
Profit Quality(5y)123.82%
High Growth Momentum
Growth
EPS 1Y (TTM)-1.61%
EPS 3Y3.53%
EPS 5Y3.4%
EPS Q2Q%2.17%
EPS Next Y13.11%
EPS Next 2Y9.14%
EPS Next 3Y8.79%
EPS Next 5Y10.8%
Revenue 1Y (TTM)15.34%
Revenue growth 3Y7.08%
Revenue growth 5Y11.46%
Sales Q2Q%10.95%
Revenue Next Year9.13%
Revenue Next 2Y7.14%
Revenue Next 3Y6.42%
Revenue Next 5Y6.91%
EBIT growth 1Y19.5%
EBIT growth 3Y7.82%
EBIT growth 5Y5.86%
EBIT Next Year42.35%
EBIT Next 3Y16.28%
EBIT Next 5Y12.56%
FCF growth 1Y72.75%
FCF growth 3Y11.93%
FCF growth 5Y9.91%
OCF growth 1Y36.01%
OCF growth 3Y4.45%
OCF growth 5Y7.26%