Ambev SA (ABEV) AI Stock Analysis

• Market Cap: $36.58B
• Dividend Yield: 5.53%
• Average Volume (3M): 30.47M
• Price to Earnings (P/E): 14.2
• Beta (1Y): 0.22
• Revenue Growth: N/A
• EPS Growth: N/A
• Country: US
• Employees: 43,000
• Sector: Consumer Defensive
• Sector Strength: 86
• Industry: Beverages - Alcoholic
• EPS (TTM): 0.17
• Shares Outstanding: 15,761,639,000
• 10 Day Avg. Volume: 32,837,337
• 30 Day Avg. Volume: 30,469,098
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 2.69
• Price to Cash Flow (P/CF): N/A
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $3.12
• Price Target Upside: 38.67% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

Ambev's strong financial performance and positive earnings call sentiment underpin its robust stock score. The company demonstrates solid profitability, low leverage, and effective capital management. Technical indicators show upward momentum, although caution is advised due to potential overbought conditions. While the valuation is not particularly low, the attractive dividend yield adds appeal. Despite challenges in certain markets, the company's strategic initiatives and digital transformation efforts position it well for continued growth.

Positive Factors

Capital Allocation

Ambev plans to increase the frequency of cash returns, potentially providing more visibility on capital allocation and supporting the shares.

Market Position

Higher beer prices could benefit Ambev by positioning it better in the mainstream category and potentially gaining market share.

Valuation

Ambev's stock is seen as trading at an attractive 7% free cash flow yield, suggesting a potentially good investment opportunity.

Negative Factors

Dividend Expectations

Ambev's announced dividends and interest-on-capital payments were below estimates and consensus expectations.

Future Cost Risks

The main risk for Ambev is identified in 2026 due to potential increases in costs driven by higher aluminum prices and potential currency depreciation.

Investor Concerns

The announcement could be disappointing to investors as the expected dividend payout was lower than anticipated.

Ambev SA Business Overview & Revenue Model

Company Description

Ambev S.A., through its subsidiaries, produces, distributes, and sells beer, draft beer, carbonated soft drinks, other non-alcoholic beverages, malt, and food products in the Americas. The company operates through four segments: Brazil; Central America and the Caribbean; Latin America South; and Canada. It offers beer primarily under the Skol, Brahma, Antarctica, Brahva, Brahva Gold, Extra, Bud Light, Beck, Leffe and Hoegaarden, Bucanero, Cristal, Mayabe, Cacique, Presidente, Brahma Light, Presidente Light, Presidente Golden Light, Bohemia, The One, Corona, Modelo Especial, Stella Artois, and Budweiser, Quilmes Clásica, Paceña, Taquiña, Huari, Becker, Cusqueña, Michelob Ultra, Busch, Pilsen, Ouro Fino, Banks, Deputy, Patricia, Labatt Blue, Alexander Keith's, and Kokanee brands. The company also provides bottled water, isotonic beverages, energy drinks, coconut water, powdered and natural juices, and ready-to-drink teas under the Guaraná Antarctica, Gatorade, H2OH!, Lipton Iced Tea, Fusion, Do Bem, Pepsi, Canada Dry, Squirt, Red Rock, Pepsi-Cola, Seven Up, Nutrl, Bud Light Seltzer, Palm Bay, and Mike's brands. It offers its products through a network of third-party distributors and a direct distribution system. The company was founded in 1885 and is headquartered in São Paulo, Brazil. Ambev S.A. is a subsidiary of Interbrew International B.V.

How the Company Makes Money

Ambev SA generates revenue through the sale of its diverse beverage portfolio across multiple markets in the Americas. The company's primary revenue stream is the production and distribution of beer, which includes both its own brands and international labels under licensing agreements. Non-alcoholic beverages such as soft drinks and energy drinks also contribute to its earnings. Ambev benefits from its extensive distribution network and economies of scale, allowing it to maintain competitive pricing and strong market presence. Additionally, strategic partnerships, such as those with PepsiCo, enhance its product offerings and market reach, further driving revenue growth.

Ambev SA Financial Statement Overview

Summary

Ambev SA exhibits strong financial health across all key areas. The income statement reflects solid profitability and growth, while the balance sheet highlights low leverage and effective capital management. The cash flow statement indicates excellent liquidity and cash generation, positioning the company well for future opportunities. While performance is commendable, slight income fluctuations suggest vigilance is necessary to maintain stability.

Income Statement

Ambev SA has shown robust performance with a strong gross profit margin of 51.2% and a consistent net profit margin of 16.1% in 2024. The company experienced a healthy revenue growth rate of 12.2% from 2023 to 2024. Both EBIT and EBITDA margins are solid at 24.4% and 29.9%, respectively, indicating efficient operational management. Despite these strengths, slight fluctuations in net income across years suggest potential volatility.

Balance Sheet

The balance sheet is strong with a low debt-to-equity ratio of 0.035, highlighting limited leverage risk. Ambev's return on equity is impressive at 14.6%, reflecting effective use of equity to generate profits. Additionally, the equity ratio stands at 60.7%, suggesting a stable capital structure dominated by equity. Minimal debt and substantial cash reserves contribute to the company's solid financial footing.

Cash Flow

Ambev's cash flow statements reveal a robust free cash flow growth rate of 14.1% from 2023 to 2024, indicating strong cash generation capabilities. The operating cash flow to net income ratio remains robust at 1.81, and the free cash flow to net income ratio is 1.48, demonstrating efficient cash flow management and excellent liquidity. These metrics underscore Ambev's ability to fund operations and growth without relying heavily on external financing.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
89.45B	79.74B	79.71B	72.85B	58.38B
	Gross Profit
45.84B	40.45B	39.29B	37.19B	31.31B
	EBIT
21.80B	18.83B	17.69B	17.08B	15.97B
	EBITDA
26.72B	23.46B	23.08B	22.87B	20.77B
	Net Income Common Stockholders
14.44B	14.50B	14.46B	12.67B	11.38B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
29.84B	16.34B	15.38B	18.54B	18.79B
	Total Assets
162.51B	132.64B	137.96B	138.60B	125.20B
	Total Debt
3.45B	3.50B	3.85B	3.10B	4.79B
	Net Debt
-25.14B	-12.56B	-11.08B	-13.53B	-12.30B
	Total Liabilities
62.93B	52.50B	54.63B	54.58B	50.05B
	Stockholders Equity
98.64B	78.97B	81.96B	82.64B	73.82B
Cash Flow		Free Cash Flow
21.35B	18.71B	14.11B	15.22B	14.16B
	Operating Cash Flow
26.10B	24.71B	20.64B	22.90B	18.86B
	Investing Cash Flow
-5.46B	-5.77B	-5.00B	-7.73B	-6.80B
	Financing Cash Flow
-10.35B	-16.12B	-16.34B	-16.04B	-8.60B

Ambev SA Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 2.25
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ABEV, the sentiment is Neutral. The current price of 2.25 is below the 20-day moving average (MA) of 2.31, above the 50-day MA of 2.11, and above the 200-day MA of 2.07, indicating a neutral trend. The MACD of 0.08 indicates Positive momentum. The RSI at 67.29 is Neutral, neither overbought nor oversold. The STOCH value of 55.48 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ABEV.

Ambev SA Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ABEV	83 Outperform	$36.58B	14.22	16.55%	5.53%	―	―
CCU	79 Outperform	$2.63B	15.67	11.55%	1.77%	0.15%	35.56%
BUD	74 Outperform	$119.05B	20.93	7.31%	1.06%	0.64%	10.02%
FMX	74 Outperform	$19.82B	13.08	9.61%	1.54%	3.83%	-49.90%
TAP	74 Outperform	$12.28B	11.33	8.54%	2.95%	-0.64%	22.45%
STZ	68 Neutral	$33.15B	49.10	-0.98%	2.20%	3.69%	-55.78%
Sector *	63 Neutral	$20.41B	13.98	-16.01%	3.26%	1.30%	5.01%