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AB InBev (BUD) to Report Q4 Earnings: What's in the Offing?

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Anheuser-Busch InBev SA/NV BUD, also known as AB InBev, is slated to release fourth-quarter 2019 results on Feb 27. In the last reported quarter, it delivered a negative earnings surprise of 10.3%. Moreover, the company recorded a negative earnings surprise of 7.5%, on average, in the trailing four quarters.

The Zacks Consensus Estimate for its fourth-quarter earnings is pegged at 53 cents, suggesting a decline of 33.8% from the year-ago quarter’s reported figure. Moreover, the consensus estimate has been unchanged in the past 30 days. The consensus estimate for total revenues of $13,373 million indicates a decline of 6.2% from the year-ago quarter’s reported number.

Key Factors to Note

Strong sales trend and consistent strength in global brands — Budweiser, Corona and Stella Artois — are likely to have contributed to AB InBev’s top-line performance in the quarter. Revenue gains from improving trends in key markets and continued growth of premium brands are likely to get reflected in the fourth-quarter results. The company’s global premiumization and revenue-management initiatives are also likely to have aided revenue per hl growth in the quarter under review. Its premiumization strategy has been led by its High End Company and global brands portfolio, which have been delivering strong growth.

Anheuser-Busch InBev SA/NV Price and EPS Surprise


Anheuser-Busch InBev SA/NV Price and EPS Surprise

Anheuser-Busch InBev SA/NV price-eps-surprise | Anheuser-Busch InBev SA/NV Quote

Moreover, AB InBev has been on track with its smart affordability strategy, which is a category expansion framework that targets reaching new consumers and introducing beer to new occasions at affordable price points. Gains from these initiatives are likely to get reflected in the fourth-quarter results.

However, softness in beer demand, particularly in the United States, is likely to have impacted total and own-beer volumes in the region. Major changes in consumer preferences toward premiumization along with health and wellness awareness, and demographic changes in the population have been causing a mix shift within the beer segment. Further, adverse currency translations and commodity cost inflation are likely to have been dragging.

Zacks Model

Our proven model doesn’t conclusively predict earnings beat for AB InBev this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

AB InBev has a Zacks Rank #3 and Earnings ESP of 0.00%.

Stocks Poised to Beat Earnings Estimates

Here are some companies that you may want to consider as our model shows that these have the right combination of elements to deliver an earnings beat.

Coca Cola Femsa S.A.B. de C.V. KOF presently has an Earnings ESP of +5.47% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Costco Wholesale Corporation COST has an Earnings ESP of +0.20% and a Zacks Rank #2 at present.

Limoneira Co LMNR currently has an Earnings ESP of +2.70% and a Zacks Rank #3.

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