Revisiting Anheuser-Busch (ENXTBR:ABI) Valuation After Its Recent Three-Month Share Price Outperformance

Anheuser-Busch InBev (ENXTBR:ABI) has quietly outperformed the broader market over the past 3 months. That kind of steady move usually signals that investors are reassessing its earnings power and valuation.

See our latest analysis for Anheuser-Busch InBev.

Looking beyond the recent 3 month share price return of 8.24%, ABI’s 1 year total shareholder return of 7.70% suggests steady, if not spectacular, progress as investors cautiously reprice its earnings momentum and leverage risks.

If ABI’s rebound has you rethinking the consumer space, it might also be worth scanning fast growing stocks with high insider ownership for other under the radar names building similar momentum.

Yet with analysts still seeing upside to the current share price, and solid earnings growth coming through, is Anheuser-Busch InBev quietly trading at a discount, or is the market already fully pricing in its next phase of growth?

Most Popular Narrative: 21.1% Undervalued

Against a last close of €54.12, the most followed narrative sees Anheuser-Busch InBev’s fair value meaningfully higher, built on disciplined growth and margin expansion.

Ongoing operational optimization, including disciplined resource allocation, productivity initiatives, supply chain efficiencies, and deleveraging (net debt/EBITDA improving YoY), is supporting margin expansion (EBITDA margin up 116bps in Q2) and generating increased free cash flow, providing more flexibility for shareholder returns and future investments, benefiting net earnings over the longer term.

Read the complete narrative.

Want to see what kind of steady growth path and richer profit margins are baked into this upside case, and how they justify a higher future earnings multiple and share count decline assumptions, all tied together by a specific discount rate and fair value target?

Result: Fair Value of $68.58 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, sustained volume weakness in key emerging markets or stubbornly high leverage could quickly undermine the margin and valuation gains implied in this upside case.

Find out about the key risks to this Anheuser-Busch InBev narrative.

Build Your Own Anheuser-Busch InBev Narrative

If you see the story unfolding differently, or simply want to dig into the numbers yourself, you can build a fresh narrative in just a few minutes: Do it your way.

A great starting point for your Anheuser-Busch InBev research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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