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Joe Raedle
JPMorgan upgraded Anheuser-Busch InBev (BUD) to an Overweight rating in a two-notch lift after having the beer stock slotted at Underweight.
Analyst Jard Dinges and team said they now see scope for earnings outperformance for BUD and a rapidly deleveraging balance sheet is said to provide optionality.
Upside drivers for BUD called out include the LatAm business that is expected to sustain positive volume momentum through at least FY23. ABI’s U.S. business is also noted to be benefitting from an underappreciated rebound of domestic light beer while recent NielsenIQ data suggests price/mix could outperform expectations.
The firm also pointed to reduced balance sheet risk for BUD and attractive valuation at 14.6X 2024 P/E and 8.3X EV/EBITDA.
Shares of BUD ripped a 4.51% gain on Monday during the premarket session.
See all the profitability metrics on Anheuser-Busch InBev.