AMBEV SA-ADR (ABEV) Stock Fundamental Analysis
NYSE:ABEV - New York Stock Exchange, Inc. - US02319V1035 - ADR - Currency: USD
We assign a fundamental rating of 6 out of 10 to ABEV. ABEV was compared to 32 industry peers in the Beverages industry. ABEV has an average financial health and profitability rating. A decent growth rate in combination with a cheap valuation! Better keep an eye on ABEV. This makes ABEV very considerable for value investing!
1. Profitability
1.1 Basic Checks
ABEV had positive earnings in the past year.
In the past year ABEV had a positive cash flow from operations.
In the past 5 years ABEV has always been profitable.
ABEV had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
ABEV has a Return On Assets of 8.88%. This is in the better half of the industry: ABEV outperforms 71.88% of its industry peers.
ABEV has a better Return On Equity (14.64%) than 65.63% of its industry peers.
ABEV has a Return On Invested Capital of 17.01%. This is amongst the best in the industry. ABEV outperforms 87.50% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ABEV is above the industry average of 12.18%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.88% | ||
| ROE | 14.64% | ||
| ROIC | 17.01% |
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 16.14%. This is amongst the best in the industry. ABEV outperforms 84.38% of its industry peers.
In the last couple of years the Profit Margin of ABEV has declined.
ABEV's Operating Margin of 24.48% is fine compared to the rest of the industry. ABEV outperforms 75.00% of its industry peers.
In the last couple of years the Operating Margin of ABEV has declined.
ABEV's Gross Margin of 51.24% is fine compared to the rest of the industry. ABEV outperforms 62.50% of its industry peers.
In the last couple of years the Gross Margin of ABEV has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 24.48% | ||
| PM (TTM) | 16.14% | ||
| GM | 51.24% |
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.
Compared to 1 year ago, ABEV has about the same amount of shares outstanding.
Compared to 5 years ago, ABEV has about the same amount of shares outstanding.
The debt/assets ratio for ABEV has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 3.59 indicates that ABEV is not in any danger for bankruptcy at the moment.
ABEV has a Altman-Z score (3.59) which is comparable to the rest of the industry.
ABEV has a debt to FCF ratio of 0.16. This is a very positive value and a sign of high solvency as it would only need 0.16 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 0.16, ABEV belongs to the best of the industry, outperforming 87.50% of the companies in the same industry.
ABEV has a Debt/Equity ratio of 0.02. This is a healthy value indicating a solid balance between debt and equity.
ABEV's Debt to Equity ratio of 0.02 is amongst the best of the industry. ABEV outperforms 81.25% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.02 | ||
| Debt/FCF | 0.16 | ||
| Altman-Z | 3.59 |
ROIC/WACC0.87
WACC19.46%
2.3 Liquidity
ABEV has a Current Ratio of 1.10. This is a normal value and indicates that ABEV is financially healthy and should not expect problems in meeting its short term obligations.
ABEV has a Current ratio of 1.10. This is comparable to the rest of the industry: ABEV outperforms 46.88% of its industry peers.
ABEV has a Quick Ratio of 1.10. This is a bad value and indicates that ABEV is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.86, ABEV is in line with its industry, outperforming 53.13% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.1 | ||
| Quick Ratio | 0.86 |
3. Growth
3.1 Past
The earnings per share for ABEV have decreased by -2.15% in the last year.
The Earnings Per Share has been growing slightly by 3.40% on average over the past years.
Looking at the last year, ABEV shows a quite strong growth in Revenue. The Revenue has grown by 12.18% in the last year.
Measured over the past years, ABEV shows a quite strong growth in Revenue. The Revenue has been growing by 11.46% on average per year.
EPS 1Y (TTM)-2.15%
EPS 3Y3.53%
EPS 5Y3.4%
EPS Q2Q%6.9%
Revenue 1Y (TTM)12.18%
Revenue growth 3Y7.08%
Revenue growth 5Y11.46%
Sales Q2Q%35.25%
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 Year7.35%
Revenue Next 2Y6.41%
Revenue Next 3Y5.72%
Revenue Next 5Y6.91%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 15.19, which indicates a correct valuation of ABEV.
ABEV's Price/Earnings ratio is rather cheap when compared to the industry. ABEV is cheaper than 90.63% of the companies in the same industry.
ABEV's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.63.
A Price/Forward Earnings ratio of 13.76 indicates a correct valuation of ABEV.
93.75% of the companies in the same industry are more expensive than ABEV, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of ABEV to the average of the S&P500 Index (20.85), we can say ABEV is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.19 | ||
| Fwd PE | 13.76 |
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 90.63% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, ABEV is valued cheaper than 96.88% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.47 | ||
| EV/EBITDA | 6.66 |
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)1.16
PEG (5Y)4.47
EPS Next 2Y9.14%
EPS Next 3Y8.79%
5. Dividend
5.1 Amount
ABEV has a Yearly Dividend Yield of 5.42%, which is a nice return.
ABEV's Dividend Yield is rather good when compared to the industry average which is at 3.00. ABEV pays more dividend than 93.75% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.51, ABEV pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.42% |
5.2 History
The dividend of ABEV decreases each year by -12.44%.
ABEV has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)-12.44%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
28.10% of the earnings are spent on dividend by ABEV. This is a low number and sustainable payout ratio.
DP28.1%
EPS Next 2Y9.14%
EPS Next 3Y8.79%
2.43
+0.03 (+1.25%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryBeverages
Earnings (Last)
Earnings (Next)
Inst Owners7.23%
Inst Owner Change0.12%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap38.02B
Analysts73.04
Price Target2.49 (2.47%)
Short Float %0.91%
Short Ratio1.09
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.42% |
Yearly Dividend0.04
Dividend Growth(5Y)-12.44%
DP28.1%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.07%
Min EPS beat(2)-7.8%
Max EPS beat(2)7.94%
EPS beat(4)2
Avg EPS beat(4)-1.82%
Min EPS beat(4)-11.29%
Max EPS beat(4)7.94%
EPS beat(8)4
Avg EPS beat(8)0.86%
EPS beat(12)8
Avg EPS beat(12)8.32%
EPS beat(16)11
Avg EPS beat(16)11.08%
Revenue beat(2)1
Avg Revenue beat(2)-1.13%
Min Revenue beat(2)-3.87%
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)-4.18%
Revenue beat(12)3
Avg Revenue beat(12)-3.4%
Revenue beat(16)7
Avg Revenue beat(16)-1.28%
PT rev (1m)2.41%
PT rev (3m)-2.45%
EPS NQ rev (1m)-2.56%
EPS NQ rev (3m)-0.24%
EPS NY rev (1m)2.38%
EPS NY rev (3m)2.08%
Revenue NQ rev (1m)2.42%
Revenue NQ rev (3m)2.58%
Revenue NY rev (1m)0%
Revenue NY rev (3m)2.89%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.19 | ||
| Fwd PE | 13.76 | ||
| P/S | 2.5 | ||
| P/FCF | 10.47 | ||
| P/OCF | 8.57 | ||
| P/B | 2.27 | ||
| P/tB | 5.35 | ||
| EV/EBITDA | 6.66 |
EPS(TTM)0.16
EY6.58%
EPS(NY)0.18
Fwd EY7.27%
FCF(TTM)0.23
FCFY9.55%
OCF(TTM)0.28
OCFY11.67%
SpS0.97
BVpS1.07
TBVpS0.45
PEG (NY)1.16
PEG (5Y)4.47
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.88% | ||
| ROE | 14.64% | ||
| ROCE | 19.36% | ||
| ROIC | 17.01% | ||
| ROICexc | 23.1% | ||
| ROICexgc | 72.86% | ||
| OM | 24.48% | ||
| PM (TTM) | 16.14% | ||
| GM | 51.24% | ||
| FCFM | 23.87% |
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-Score7
Asset Turnover0.55
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.02 | ||
| Debt/FCF | 0.16 | ||
| Debt/EBITDA | 0.07 | ||
| Cap/Depr | 66.64% | ||
| Cap/Sales | 5.31% | ||
| Interest Coverage | 29.52 | ||
| Cash Conversion | 89.91% | ||
| Profit Quality | 147.88% | ||
| Current Ratio | 1.1 | ||
| Quick Ratio | 0.86 | ||
| Altman-Z | 3.59 |
F-Score7
WACC19.46%
ROIC/WACC0.87
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)-2.15%
EPS 3Y3.53%
EPS 5Y3.4%
EPS Q2Q%6.9%
EPS Next Y13.11%
EPS Next 2Y9.14%
EPS Next 3Y8.79%
EPS Next 5Y10.8%
Revenue 1Y (TTM)12.18%
Revenue growth 3Y7.08%
Revenue growth 5Y11.46%
Sales Q2Q%35.25%
Revenue Next Year7.35%
Revenue Next 2Y6.41%
Revenue Next 3Y5.72%
Revenue Next 5Y6.91%
EBIT growth 1Y15.05%
EBIT growth 3Y7.82%
EBIT growth 5Y5.86%
EBIT Next Year43.05%
EBIT Next 3Y16.4%
EBIT Next 5Y12.56%
FCF growth 1Y14.13%
FCF growth 3Y11.93%
FCF growth 5Y9.91%
OCF growth 1Y5.62%
OCF growth 3Y4.45%
OCF growth 5Y7.26%