Head to Head Analysis: Ambev (ABEV) versus Its Peers

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

Profitability

This table compares Ambev and its rivals’ 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	-8.12%	-16.44%	0.13%

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 48.2% of their earnings in the form of a dividend.

Earnings & Valuation

This table compares Ambev and its rivals top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Ambev	$89.02 billion	$2.78 billion	14.76
Ambev Competitors	$53.65 billion	$869.16 million	6.03

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

Risk & Volatility

Ambev has a beta of 0.58, suggesting that its stock price is 42% less volatile than the S&P 500. Comparatively, Ambev’s rivals have a beta of -0.24, suggesting that their average stock price is 124% less volatile than the S&P 500.

Institutional & Insider 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 hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings and price targets for Ambev and its rivals, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ambev	2	4	0	0	1.67
Ambev Competitors	1290	4339	5789	231	2.43

Ambev currently has a consensus target price of $3.01, indicating a potential upside of 7.22%. As a group, “Beverages” companies have a potential upside of 8.58%. Given Ambev’s rivals stronger consensus rating and higher probable upside, analysts clearly believe Ambev has less favorable growth aspects than its rivals.

Summary

Ambev beats its rivals on 8 of the 15 factors compared.

Ambev Company Profile

Ambev S.A. is a beverage company headquartered in São Paulo, Brazil. It produces, distributes and sells beer and other beverages, including soft drinks, water and energy drinks. Its beer portfolio includes brands such as Brahma, Antarctica and Skol, as well as international brands marketed under license or through distribution agreements. The company serves customers across Brazil and other markets in Latin America, including countries in South America, Central America and the Caribbean. Its operations span beverage production, packaging and distribution, supported by a network that delivers products to retailers, bars and restaurants.