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Will AB InBev (BUD) Retain Positive Earnings Trend in Q1?
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Anheuser-Busch InBev SA/NV (BUD - Free Report) , also known as AB InBev, is slated to release first-quarter 2018 results on May 9. In the last reported quarter, the company delivered positive earnings surprise of 6.1%.
In fact, fourth-quarter 2017 marked the company’s first earnings beat after seven consecutive quarters of negative surprises, while revenues surpassed estimates after two straight misses. It recorded an average negative surprise of 12.3% in the trailing four quarters. Let’s see how things are shaping up prior to this announcement.
What to Expect
The Zacks Consensus Estimate for the quarter under review is pegged at 79 cents, reflecting year-over-year growth of 6.8%. However, estimates witnessed a downtrend in the last 30 days. Analysts polled by Zacks anticipate total revenues of 12.8 billion, which reflects a decline of 0.7% year over year.
Anheuser-Busch InBev SA/NV Price, Consensus and EPS Surprise
Additionally, the AB InBev stock has been witnessing a downtrend lately, mainly due to a soft outlook for first-quarter 2018. The stock has declined 10.4% in the past month, wider than the industry’s fall of 5%, reflecting a bearish sentiment ahead of the earnings release.
Factors at Play
While AB InBev's fourth-quarter 2017 results marked a return to the positive earnings trajectory, a soft outlook for the first quarter seems to be weighing upon its performance. The company envisions a soft first quarter, owing to difficult comparisons, and phasing of marketing and sales initiatives. Moreover, the company is witnessing volatility in certain key markets.
However, AB InBev’s robust brand portfolio and solid geographical reach remain major strengths. Further, given the rising demand for craft beer space, we expect the company to benefit from its constant expansion in this category. Also, it keeps introducing near-beer alternatives, along with no- and low-alcohol beers, which is encouraging.
Additionally, the company remains well on track with the SABMiller integration. It expects synergies and cost savings of nearly $3.2 billion from the integration, which are expected to be realized in four years from the closing of the acquisition (or by October 2020).
The company anticipates delivering strong top-line growth for 2018, backed by solid brands performance and robust commercial plans. Furthermore, we believe AB InBev is poised to grow driven by the strength of the Budweiser brand and robust initiatives.
What the Zacks Model Unveils?
Our proven model shows that AB InBev is likely to beat earnings estimates this quarter. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen.
AB InBev’s Earnings ESP of +4.46% and Zacks Rank #3 make us reasonably confident of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks Poised to Beat Earnings Estimates
Here are some other companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
Flowers Foods, Inc. (FLO - Free Report) has an Earnings ESP of +3.85% and a Zacks Rank #3.
The J.M. Smucker Company (SJM - Free Report) has an Earnings ESP of +0.71% and a Zacks Rank #3.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Image: Bigstock
Will AB InBev (BUD) Retain Positive Earnings Trend in Q1?
Anheuser-Busch InBev SA/NV (BUD - Free Report) , also known as AB InBev, is slated to release first-quarter 2018 results on May 9. In the last reported quarter, the company delivered positive earnings surprise of 6.1%.
In fact, fourth-quarter 2017 marked the company’s first earnings beat after seven consecutive quarters of negative surprises, while revenues surpassed estimates after two straight misses. It recorded an average negative surprise of 12.3% in the trailing four quarters. Let’s see how things are shaping up prior to this announcement.
What to Expect
The Zacks Consensus Estimate for the quarter under review is pegged at 79 cents, reflecting year-over-year growth of 6.8%. However, estimates witnessed a downtrend in the last 30 days. Analysts polled by Zacks anticipate total revenues of 12.8 billion, which reflects a decline of 0.7% year over year.
Anheuser-Busch InBev SA/NV Price, Consensus and EPS Surprise
Anheuser-Busch InBev SA/NV Price, Consensus and EPS Surprise | Anheuser-Busch InBev SA/NV Quote
Additionally, the AB InBev stock has been witnessing a downtrend lately, mainly due to a soft outlook for first-quarter 2018. The stock has declined 10.4% in the past month, wider than the industry’s fall of 5%, reflecting a bearish sentiment ahead of the earnings release.
Factors at Play
While AB InBev's fourth-quarter 2017 results marked a return to the positive earnings trajectory, a soft outlook for the first quarter seems to be weighing upon its performance. The company envisions a soft first quarter, owing to difficult comparisons, and phasing of marketing and sales initiatives. Moreover, the company is witnessing volatility in certain key markets.
However, AB InBev’s robust brand portfolio and solid geographical reach remain major strengths. Further, given the rising demand for craft beer space, we expect the company to benefit from its constant expansion in this category. Also, it keeps introducing near-beer alternatives, along with no- and low-alcohol beers, which is encouraging.
Additionally, the company remains well on track with the SABMiller integration. It expects synergies and cost savings of nearly $3.2 billion from the integration, which are expected to be realized in four years from the closing of the acquisition (or by October 2020).
The company anticipates delivering strong top-line growth for 2018, backed by solid brands performance and robust commercial plans. Furthermore, we believe AB InBev is poised to grow driven by the strength of the Budweiser brand and robust initiatives.
What the Zacks Model Unveils?
Our proven model shows that AB InBev is likely to beat earnings estimates this quarter. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen.
AB InBev’s Earnings ESP of +4.46% and Zacks Rank #3 make us reasonably confident of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks Poised to Beat Earnings Estimates
Here are some other companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
United Natural Foods, Inc. (UNFI - Free Report) has an Earnings ESP of +1.86% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Flowers Foods, Inc. (FLO - Free Report) has an Earnings ESP of +3.85% and a Zacks Rank #3.
The J.M. Smucker Company (SJM - Free Report) has an Earnings ESP of +0.71% and a Zacks Rank #3.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>