Ambev S.A. (ABEV) Shares: Are They Risky Or Cheap?


Ambev S.A. (NYSE:ABEV) finished Thursday with a subtraction of $0.0 to close at $2.75, a downside of 0.00 percent. An average of 13,501,260 shares of common stock have been traded in the last five days. The last 20 days have seen an average of 26,321,516 shares traded, while the 50-day average volume stands at 28,789,992.

ABEV stock has decreased by -5.82% in the last month. The company shares reached their 1-month lowest point of $2.71 on 12/27/22. With the stock rallying to its 52-week high on 04/12/22, shares of the company touched a low of $2.42 and a high of $3.32 in 52 weeks. It has reached a new high 17 times so far this year and lost -1.79% or -$0.05 in price. In spite of this, the price is down -17.04% from the 52-week high.

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Valuation Metrics

Ambev S.A. (ABEV) has a trailing price-to-earnings (P/E) ratio of 17.19. The stock’s beta is 1.06. Other valuation ratios to consider include the trailing price-to-sales (P/S) ratio at 2.81, the price-to-book (PB) ratio at 2.48, and the price-to-cash flow ratio at 68.42.

The company has a payout ratio of 850.30%. The company’s most recent quarterly dividend payment was $0.1457 a share, representing a up of 73.66% from $0.0839 last year. Its latest increase dividend $0.0618 reported on Monday December 12 2022.

Financial Health

The quick ratio of Ambev S.A. for the three months ended September 29 was 0.80, and the current ratio was 1.20, indicating that the company is not able to meet its debt obligations. Further, the company has a long term debt to equity ratio of 0.02 and a total debt to equity ratio of 0.03 for the quarter ending September 29. Its gross profit as reported stood at $6.89 billion compared to revenue of $13.5 billion.

For investors, determining the potential profitability of the investment also depends on the performance of the company’s management. In the past 12 months, Ambev S.A.’s return on assets was 9.60%.

Earnings Surprise

In the quarter under review, the net income was up than the previous quarter. The company posted a net income of $2.41 billion in the quarter, while revenues were shrunk -372.67%. The analyst consensus anticipated Ambev S.A.’s latest quarter earnings to come in at $0.03 per share, but it turned out to be $0.04, a 33.30% surprise. For the quarter, EBITDA amounted to $1.03 billion.

Technical Picture

From a technical analysis perspective, let’s take a brief look at Ambev S.A. (ABEV) price momentum. RSI 9-day as of the close on 29 December was 39.61%, suggesting the stock is Neutral, with historical volatility in this time frame at 32.40%.

As of today, ABEV’s price is $2.76 unch or $unch from its 5-day moving average. ABEV is currently trading -9.84% lower than its 20-day SMA and -3.51% lower than its 100-day SMA. However, the stock’s current price level is -1.79% below the SMA50 and +4.96% above the SMA200.

The stochastic %K and %D were 10.39% and 14.36%, respectively, and the average true range (ATR) was 0.08. With the 14-day stochastic at 15.38% and the average true range at 0.08, the RSI (14) stands at 41.32%. The stock has reached -0.03 on the 9-day MACD Oscillator while the 14-day reading was at -0.06.

Analyst Ratings

JP Morgan upgraded Ambev S.A. (NYSE: ABEV) to a an Overweight rating in its most recent analyst report. Previously, the stock was rated as a Neutral. The consensus rating for Ambev S.A. (ABEV) among analysts is Overweight. According to current brokerage recommendations, 3 brokerage firms advise that investors sell ABEV, while 3 suggest investors hold. There are 0 analysts who rate the stock as underweight. The stock is rated overweight by 1 analysts, while 9 others rate it as a “buy”.

What is ABEV’s price target for the next 12 months?

Analysts predict a range of price targets between $2.40 and $5.00, with a median target of $3.40. Taking a look at these predictions, the average price target given by analysts for Ambev S.A. (ABEV) stock is $3.56.


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