(CercleFinance.com) – HSBC on Wednesday downgraded its recommendation on AB InBev shares, reduced from ‘buy’ to ‘hold’ with a price target revised downwards from 68 to 66 euros.
In a research note, the analyst explains that he wonders how the brewer found himself plunged into the crisis around his Bud Light brand, and especially how he managed it.
According to figures from Beer Marketer’s Insights taken over by the intermediary, the fall in sales of Bud Ligh should indeed have intensified in April, with volumes seen falling by more than 25%.
HSBC adds that the group’s relations with its American distributors have also never been so bad, according to consultants in the sector.
For the professional, it is far from obvious that AB InBev will be able to reverse this trend without reshuffling its management team.
More generally, he believes that these problems rekindle uncertainties about the company’s ability to create a real brand culture.
While waiting to know to what extent Bud Light and the other brands of the group will be impacted, in particular from a financial point of view, and while waiting for the implementation of a better vision in terms of marketing, HSBC says prefer to stay away from value.
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