Is Molson Coors a Bargain After 18.9% Drop and Industry Volatility in 2025?

• Wondering whether Molson Coors Beverage is undervalued, especially with the market in flux? You are not alone, and it is exactly the right time to take a closer look.
• The stock recently gained 2.5% over both the past week and month, but it is still down 18.9% year-to-date and has dropped 21.7% over the past year, hinting at changing investor sentiment.
• Some of this volatility follows industry chatter about shifting consumer preferences and ongoing supply chain adjustments, with analysts debating just how permanent or temporary these pressures might be for beverage companies like Molson Coors.
• On our valuation scorecard, Molson Coors clocks in at 5 out of 6 for being undervalued. This suggests some hidden value but also room for a deeper dive. Next up, we will walk through the main ways investors typically value a stock like this and reveal an even better approach you will want to know about by the end of the article.

Find out why Molson Coors Beverage's -21.7% return over the last year is lagging behind its peers.

Approach 1: Molson Coors Beverage Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model helps investors estimate a company’s true value by projecting its future cash flows and then discounting those estimates back to their value in today’s dollars. This approach offers a way to look past short-term price swings and focus on the company’s actual ability to generate cash over time.

For Molson Coors Beverage, the most recent annual Free Cash Flow stands at $1.08 Billion. According to analyst forecasts and further estimates, annual Free Cash Flow is projected to gradually increase, reaching around $1.33 Billion by the end of 2029. While the first five years of these projections are rooted in analyst expectations, any figures beyond that are extrapolated by Simply Wall St to provide a longer-term outlook.

Based on this two-stage DCF model, the intrinsic value for Molson Coors Beverage is estimated at $157.08 per share. Compared to the current market price, this suggests the stock is trading at a significant 70.5% discount, indicating that it may be deeply undervalued.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Molson Coors Beverage is undervalued by 70.5%. Track this in your watchlist or portfolio, or discover 933 more undervalued stocks based on cash flows.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Molson Coors Beverage.

Approach 2: Molson Coors Beverage Price vs Sales

For companies like Molson Coors Beverage, which continue to generate stable revenues, the Price-to-Sales (P/S) ratio is a practical valuation tool. This metric is especially helpful for analyzing businesses with steady or cyclical profits and offers insight even if earnings are volatile or temporarily negative. This situation can often occur in the beverage industry.

Typically, higher growth prospects and lower risk profiles command a richer or higher multiple, as investors are willing to pay more for each dollar of sales when they expect rapid expansion or very predictable results. Conversely, lower growth or greater business risks warrant a more conservative valuation.

Molson Coors Beverage currently trades at a Price-to-Sales ratio of 0.82x. This is notably below both the industry average of 2.23x and the average peer multiple of 1.82x, suggesting the market is pricing in lower expectations or higher risk compared to similar companies.

Simply Wall St's proprietary Fair Ratio for Molson Coors Beverage, calculated from a blend of the company’s revenue growth, margins, risks, and size, stands at 1.26x. Unlike a simple comparison to peers or industry averages, this Fair Ratio is a more tailored yardstick that reflects the company’s unique fundamentals, giving investors a smarter reference point.

Comparing the Fair Ratio of 1.26x to the company’s current multiple of 0.82x points to meaningful undervaluation by this measure.

Result: UNDERVALUED

PS ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1437 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Molson Coors Beverage Narrative

Earlier, we mentioned that there is an even better way to understand valuation, so let’s introduce you to Narratives. A Narrative is a simple, approachable way to capture your own story about a company’s future, linking real business developments to your forecast for future revenue, earnings, margins, and ultimately, a fair value. Instead of relying solely on ratios or analyst targets, Narratives let you create and track a living investment thesis that is transparently connected to real-world assumptions.

Narratives are available to everyone in the Simply Wall St Community, with millions of other investors already using them to guide their buy or sell decisions. By clearly comparing your Narrative Fair Value to the current share price, you are able to make smarter, more timely moves. These Narratives automatically update as new information, like fresh earnings reports or key news, comes in.

For example, when it comes to Molson Coors Beverage, some investors in the Community see upside as high as $72 per share thanks to premium product growth and international expansion, while others take a more cautious stance, setting fair value closer to $42 due to ongoing U.S. market pressure and high input costs. With Narratives, you can choose the perspective that best matches your own outlook and adjust it whenever new facts emerge.

Do you think there's more to the story for Molson Coors Beverage? Head over to our Community to see what others are saying!

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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