Financial Comparison: Ambev (ABEV) vs. The Competition

Ambev (NYSE:ABEV) is one of 137 public companies in the “Beverages” industry, but how does it contrast to its competitors? We will compare Ambev to related companies based on the strength of its risk, earnings, profitability, analyst recommendations, institutional ownership, dividends and valuation.

Valuation & Earnings

This table compares Ambev and its competitors gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Ambev	$15.80 billion	$2.78 billion	13.92
Ambev Competitors	$8.49 billion	$869.16 million	9.39

Ambev has higher revenue and earnings than its competitors. Ambev is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Analyst Recommendations

This is a summary of current ratings for Ambev and its competitors, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ambev	2	4	0	0	1.67
Ambev Competitors	1282	4324	5767	230	2.43

Ambev presently has a consensus target price of $3.01, suggesting a potential upside of 13.71%. As a group, “Beverages” companies have a potential upside of 9.03%. Given Ambev’s higher possible upside, analysts clearly believe Ambev is more favorable than its competitors.

Profitability

This table compares Ambev and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ambev	17.80%	18.13%	11.50%
Ambev Competitors	-8.60%	-34.42%	0.16%

Volatility & Risk

Ambev has a beta of 0.58, indicating that its stock price is 42% less volatile than the S&P 500. Comparatively, Ambev’s competitors have a beta of -0.23, indicating that their average stock price is 123% less volatile than the S&P 500.

Insider and Institutional Ownership

8.1% of Ambev shares are held by institutional investors. Comparatively, 36.3% of shares of all “Beverages” companies are held by institutional investors. 19.4% of shares of all “Beverages” companies are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Dividends

Ambev pays an annual dividend of $0.03 per share and has a dividend yield of 1.1%. Ambev pays out 15.8% of its earnings in the form of a dividend. As a group, “Beverages” companies pay a dividend yield of 2.9% and pay out 48.9% of their earnings in the form of a dividend.

Summary

Ambev beats its competitors on 9 of the 15 factors compared.

Ambev Company Profile

Ambev S.A., through its subsidiaries, engages in the production, distribution, and sale of beer, draft beer, carbonated soft drinks, malt and food, other alcoholic beverages, and non-alcoholic and non-carbonated products in Brazil, Central America and Caribbean, Latin America South, and Canada. It offers beer primarily under the Skol, Brahma, Antarctica, Brahva, Budweiser, Bud Light, Beck, Leffe, Hoegaarden, Balboa ICE, Balboa, Atlas Golden Light, Atlas, Bucanero, Cristal, Mayabe, Presidente, Presidente Light, Brahma Light, Bohemia, The One, Corona, Modelo Especial, Stella Artois, Quilmes Clásica, Paceña, Taquiña, Huari, Becker, Cusqueña, Michelob Ultra, Busch, Pilsen, Ouro Fino, Bud 66, Banks, Deputy, Patricia, Labatt Blue, Alexander Keith’s, and Kokanee brands. The company also provides carbonated soft drinks, bottled water, isotonic beverages, energy drinks, coconut water, powdered and natural juices, and ready-to-drink teas under the Guaraná Antarctica, Gatorade, H2OH!, Pepsi Black, Lipton Iced Tea, Fusion, Pepsi-Cola, Canada Dry, Squirt, Red Rock, Red Bull, 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.