por Michelle del Campo
Infosel, julio. 23.- A continuación, Infosel presenta las principales conclusiones que emitieron diversos analistas de distintas casas de bolsa en México y el extranjero tras el reporte de la cadena de tiendas departamentales, Becle (CUERVO), del segundo trimestre de 2020.
Monex
"Posterior al favorable reporte al 2T20, consideramos que la emisora ha logrado mejoras sus expectativas durante este año, sin embargo, en términos de volumen en diversas regiones persisten retos. Cabe señalar que si bien existe un cambio de consumo de bebidas alcohólicas al hogar desde restaurantes o bares, durante el periodo de confinamiento el entorno resultó mejor al previsto en algunos mercados. En nuestra visión estará el encarecimiento del Agave, y la perspectiva de mejorías a nivel de Costos (paulatinamente), y un posible efecto de mejores Gastos hacia el 2S20. Estaremos atentos al desempeño del consumo en México, ya que el retador escenario económico persistirá durante el 2S20".
José Cebeira y Jerónimo Cobián - Actinver (Cambio de recomendación)
"Cuervo filed a positive 2Q20 report, bringing a 10.7% YoY volume increase on the back of a 33.5% growth in the North America operation, despite a decline in the rest of the regions. The company's gross margin continued with significant pressures during this quarter, resulting in an erosion of 150 bps, ending at 53.1%, due to higher agave prices. On the positive side, the company made an unexpected reduction in Advertising, Marketing, and Promotion (AMP) expenses, sending this line from 23% of sales down to 15.8%.
As a result of the strong demand in the largest operation, North America's, coupled with our positive demand expectations of its products in the U.S. market for the 2H-2020 and the positive effect of a further depreciation of the MXN vs. the USD, we are upgrading our recommendation to "Mkt. Perform".
What to expect for the 2H20? Despite the negative effect of the COVID-19 over the worldwide economies, we have seen a stronger than expected demand in alcoholic beverages in the US market. We expect this trend to continue, although not at the same strength but at least at 15% YoY volume growth. In other regions, such as Mexico and RoW, we continue to expect volume decline, but with a continued recovery due to the opening of the on-premise channel worldwide, reaching flat figures vs. 2019 by the end of the year in both regions".
Ricardo L. Alves - Morgan Stanley (NYSE:MS)
"Cuervo reported very strong 2Q20 results; US top-line strength was above expectations, while margins improved substantially. We expect Cuervo shares to react positively today on the back of a 40% consolidated EBITDA beat to MSe; It was also 30% above consensus. We double upgraded Cuervo after our Tequila Deep Dive, with the main pillars of the investment thesis being stronger US growth for longer and higher profitability in 2021/22e. Now, we thought that gross/EBITDA margins would remain pressured in the 2Q and did not necessarily viewed the quarter result as a near term catalyst for the stock.
That said, given i) the very strong top-line performance in the US (sales up ~50% y-y,20+% in USD) and ii) the EBITDA margin improvement (up ~700bps y-y), we think 2Q underscores our view that Cuervo's earnings power has increased substantially.
In our recent conversations with investors (see our Bulls vs. Bears report), we noticed some near term caution on results, but we now think the 2Q print could ease some of these concerns and help the investment narrative for the stock".
Infosel, julio. 23.- A continuación, Infosel presenta las principales conclusiones que emitieron diversos analistas de distintas casas de bolsa en México y el extranjero tras el reporte de la cadena de tiendas departamentales, Becle (CUERVO), del segundo trimestre de 2020.
Monex
"Posterior al favorable reporte al 2T20, consideramos que la emisora ha logrado mejoras sus expectativas durante este año, sin embargo, en términos de volumen en diversas regiones persisten retos. Cabe señalar que si bien existe un cambio de consumo de bebidas alcohólicas al hogar desde restaurantes o bares, durante el periodo de confinamiento el entorno resultó mejor al previsto en algunos mercados. En nuestra visión estará el encarecimiento del Agave, y la perspectiva de mejorías a nivel de Costos (paulatinamente), y un posible efecto de mejores Gastos hacia el 2S20. Estaremos atentos al desempeño del consumo en México, ya que el retador escenario económico persistirá durante el 2S20".
José Cebeira y Jerónimo Cobián - Actinver (Cambio de recomendación)
"Cuervo filed a positive 2Q20 report, bringing a 10.7% YoY volume increase on the back of a 33.5% growth in the North America operation, despite a decline in the rest of the regions. The company's gross margin continued with significant pressures during this quarter, resulting in an erosion of 150 bps, ending at 53.1%, due to higher agave prices. On the positive side, the company made an unexpected reduction in Advertising, Marketing, and Promotion (AMP) expenses, sending this line from 23% of sales down to 15.8%.
As a result of the strong demand in the largest operation, North America's, coupled with our positive demand expectations of its products in the U.S. market for the 2H-2020 and the positive effect of a further depreciation of the MXN vs. the USD, we are upgrading our recommendation to "Mkt. Perform".
What to expect for the 2H20? Despite the negative effect of the COVID-19 over the worldwide economies, we have seen a stronger than expected demand in alcoholic beverages in the US market. We expect this trend to continue, although not at the same strength but at least at 15% YoY volume growth. In other regions, such as Mexico and RoW, we continue to expect volume decline, but with a continued recovery due to the opening of the on-premise channel worldwide, reaching flat figures vs. 2019 by the end of the year in both regions".
Ricardo L. Alves - Morgan Stanley (NYSE:MS)
"Cuervo reported very strong 2Q20 results; US top-line strength was above expectations, while margins improved substantially. We expect Cuervo shares to react positively today on the back of a 40% consolidated EBITDA beat to MSe; It was also 30% above consensus. We double upgraded Cuervo after our Tequila Deep Dive, with the main pillars of the investment thesis being stronger US growth for longer and higher profitability in 2021/22e. Now, we thought that gross/EBITDA margins would remain pressured in the 2Q and did not necessarily viewed the quarter result as a near term catalyst for the stock.
That said, given i) the very strong top-line performance in the US (sales up ~50% y-y,20+% in USD) and ii) the EBITDA margin improvement (up ~700bps y-y), we think 2Q underscores our view that Cuervo's earnings power has increased substantially.
In our recent conversations with investors (see our Bulls vs. Bears report), we noticed some near term caution on results, but we now think the 2Q print could ease some of these concerns and help the investment narrative for the stock".