Bullish analyst: Anheuser-Busch InBev “appears attractive” as a “top pick”
[Reporter's note: This is the second part of a two-part series, in which we explore the pros and cons of investing in Anheuser-Busch InBev.]
Should investors hop in and invest in Anheuser-Busch InBev? If you ask ING Wholesale Banking analyst Gerard Rijk, the answer is a big “Yes.” Anheuser-Busch InBev is one of ING’s top picks.
The upcoming half-year results should emphasize Anheuser-Busch InBev’s qualities and the need to raise earnings estimates, Rijk wrote to investors recently. In Rijk’s view, the consensus forecasts for the company’s earnings (before interest, taxes and depreciation) and earnings per share are 10 percent and 20 percent too low, respectively.
Wow. That is an impressive endorsement of the world’s biggest brewer. In the second quarter, A-B InBev’s results “will likely be characterized by top-line resilience and continued synergies,” Rijk wrote in a June 24 research note.
Rijk said there are five big reasons why investors should remain positive on Anheuser-Busch InBev:
- A broad group of lobby groups representing industries in beer, grain/malt, advertisers and unions have dampened the threat of an excise tax hike, which was floated as one way to help pay for health care restructuring.
- Resilience in the company’s Brazilian and U.S. businesses, which represent 80 percent of its results.
- A-B InBev’s price increases on a global scale are lower than that of its competitors. This better fits the
current consumer climate, in which people are choosing cheaper beers. - A-B InBev is on track to cut $2.25 billion in costs. Brewery operations, wholesalers and suppliers could all be squeezed for cost savings.
- The “divestment climate” is improving: Bond issues can get more favourable terms for the brewer, and Central European assets can be sold for an estimated $2 billion. All of this is good news for A-B InBev, which has an estimated $4.5 billion of asset sales still to do.
There you have it. Who is right about A-B InBev: the bulls or the bears? We honestly don’t know. But an interesting debate is shaping up.
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Jeremiah McWilliams is a native Virginian who came to the Post-Dispatch in early 2007 to cover beer and other consumer products. He previously covered manufacturing for the Virginian-Pilot newspaper in Norfolk, Va. He is a graduate of Washington and Lee University. 
Does everyone know ING handles the A-B employee 401K?
Please!!!Pretty Please!!!
ING not only handles the AB 401K program. The also collect very stiff management fees from the employee account holders. These fees were covered when A.B. owned us, but Carlos saw this as yet another way to screw the employees. Mr Rijk is an obvious ass-kisser trying to protect their inflated 401K fee structure by sucking up to the Belgian Crossbreeds.
Wow…
So much poison… I bet you guys want to see ABI go down the drain… I bet yo would love to see all the remaining ABI employees in St. Louis lose their jobs and join the ranks of the unemployed.
You would love to have people say how right you were predicting the doom of the company even if an already depressed St. Louis would lose yet another big source of tax income.
Oh how you will glow with happyness seeing the misery how all your pessimism would turn out right.
Quite childish and non productive if you ask me…
No poison just facts. Obviously a comment from an outsider with no knowledge of the company, trolling the site and offering uninformed emotional opinions.
MIKE………..You are the MAN………..don’t let that little short-man catch his breath.I was lucky enough to be sold this week to Ball, no longer an inbred employee.Gonna drink me some YUENGLING this 4th and grill out. happy 4th to all.
Can-Man - Good luck at Ball. As a former MCC employee, I have firsthand knowledge of the quality, efficiencies, asset utiliation, and teamwork of your organization. Ball is picking up a world class team here and will be a better company with this addition. I don’t think Brito has a clue about what he just gave away here. You are much better off working for an American company than this bunch of offshore bumblefuks.
Can Man, How many Yuengling cans do you produce? I hope it’s enough to keep your plant running. Your cut-off-your-nose-to-spite-your-face logic may come back to bite you in your can.
As for the director: no one wants teh job???