Average Growth And Margin Self-Help, But A Lot Of That Is In The Share Price Now

  • Heineken is coming out of pandemic-driven volume pressures with a bold plan to cut significant costs, reinvest in marketing and digital initiatives, and maintain an above-peer growth rate.
  • Bullish analysts are expecting better margin leverage from the self-help program but that may be premature/optimistic given Heineken’s more spread out volume/market share profile.
  • Revenue growth should remain a source of upside, with Heineken one of the leaders in premiumization and category innovation, including alcohol-free beers.
  • With the shares up 20% in about six months, I see today’s price as more “fair” than “undervalued”, and this is a name I’d look to add on pullbacks.
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