Covering the Mexican Economy, Actinver Research

Actinver

Covering the Mexican Economy

Actinver Research

Actinver is a mexican leading financial group, that generates well being for individuals and companies through advisory services that provides investment management to maintain and grow their wealth.

Equity Bottom-Up

Coca-Cola Femsa SAB de CV / Equity Bottom-Up

<ul><li>Sales grew 10% YoY to P$70.2bn, above our estimates and consensus, and despite consolidated volumes contracting 2.2% YoY, vs our flattish expectations; volumes contracted in Mexico & Central America.</li><li>Excluding FX tailwinds, sales grew 5.9% YoY, and average price per UC, meanwhile, grew 12.7% YoY.</li><li> Profitability was mostly better than expected, driven by cost efficiencies and lower raw material costs, such as sweeteners, while partially offset by FX headwinds from USD-denominated raw materials.</li></ul>

Sales grew 10% YoY to P$70.2bn, above our estimates and consensus, and despite consolidated volumes contracting 2.2% YoY, vs our flattish expectations; volumes contracted in Mexico & Central America.Excluding FX tailwinds, sales grew 5.9% YoY, and average price per UC, meanwhile, grew 12.7% YoY. Profitability was mostly better than expected, driven by cost efficiencies and lower raw material costs, such as sweeteners, while partially offset by FX headwinds from USD-denominated raw materials.

Actinver Research - KOF 1Q25: Healthy results (Quick View)

Macroeconomics

<ul>
<li>We are updating our models ahead of 1Q25 Results; calendar headwinds and a slowdown in some industries are expected, along with FX-related effects in some companies —with some companies benefitting due to their exposure—.</li>
<li>Adverse weather conditions are also expected to weigh on results. We thus forecast sales growth of 6% (9% on a median basis), with EBITDA growth of 1% (4% on a median basis).</li>
<li>We expect only 3 companies within our coverage to post flat or improving margins. In Consumer, we are keeping our ratings unchanged, with minor adjustments to PTs. </li>
</ul>


We are updating our models ahead of 1Q25 Results; calendar headwinds and a slowdown in some industries are expected, along with FX-related effects in some companies —with some companies benefitting due to their exposure—.
Adverse weather conditions are also expected to weigh on results. We thus forecast sales growth of 6% (9% on a median basis), with EBITDA growth of 1% (4% on a median basis).
We expect only 3 companies within our coverage to post flat or improving margins. In Consumer, we are keeping our ratings unchanged, with minor adjustments to PTs. 


Actinver Research - Mexico Equity Research: 1Q25 Preview

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<ul>
<li>Since late-February (2/25/25 Compass and 2/27/25 Int'l Compass) we expected an 8-10% pullback to provide a buying opportunity.</li>
<li>But that all changed last week (4/1/25 Compass and 4/3/25 Int'l Compass), when we downgraded our outlook to bearish/cautious, citing several concerning developments.</li>
<li>Despite the 90-day pause, we remain cautious and we continue to favor defensives as long as the S&amp;P 500 and ACWI-US are below their 200-day MAs.</li>
</ul>


Since late-February (2/25/25 Compass and 2/27/25 Int'l Compass) we expected an 8-10% pullback to provide a buying opportunity.
But that all changed last week (4/1/25 Compass and 4/3/25 Int'l Compass), when we downgraded our outlook to bearish/cautious, citing several concerning developments.
Despite the 90-day pause, we remain cautious and we continue to favor defensives as long as the S&amp;P 500 and ACWI-US are below their 200-day MAs.


Still Favor Defensives Until Market Dynamics Improve; EURO STOXX 50 Testing Crucial 5000 Level

<ul><li>Sales grew 14.3% YoY to P$75.5bn, above our estimates and consensus.</li><li>Consolidated volumes grew 2.2% YoY, also above our estimates, driven by performance in Brazil, Mexico and Guatemala.</li><li>Total sales were further driven by better sales mix and FX tailwinds; excluding the latter, sales grew 13% YoY.</li></ul>

Sales grew 14.3% YoY to P$75.5bn, above our estimates and consensus.Consolidated volumes grew 2.2% YoY, also above our estimates, driven by performance in Brazil, Mexico and Guatemala.Total sales were further driven by better sales mix and FX tailwinds; excluding the latter, sales grew 13% YoY.

Actinver Research - KOF 4Q24: Solid results (Quick View)

<ul>
<li>Having recently launched our Food &amp; Bev coverage (link to report here), we reiterate our Outperform ratings in beverage companies AC (PT down to P$205 from P$210), KOF (P$197 PT), FEMSA (PT up to P$230 from P$222), and Becle (PT down to P$33 from P$36).</li>
<li>We see Coke bottlers as better positioned amid a competitive environment and a picky consumer, while we forecast improving trends in FEMSA and Becle.</li>
<li>We are more cautious on Bimbo (Market Perform) and Gruma (Market Perform), given harsh competition in their main markets and a more limited price/volume growth potential, in our view.</li>
</ul>


Having recently launched our Food &amp; Bev coverage (link to report here), we reiterate our Outperform ratings in beverage companies AC (PT down to P$205 from P$210), KOF (P$197 PT), FEMSA (PT up to P$230 from P$222), and Becle (PT down to P$33 from P$36).
We see Coke bottlers as better positioned amid a competitive environment and a picky consumer, while we forecast improving trends in FEMSA and Becle.
We are more cautious on Bimbo (Market Perform) and Gruma (Market Perform), given harsh competition in their main markets and a more limited price/volume growth potential, in our view.


Actinver Research - Consumer post 3Q24: Sales deceleration while trying to protect margins

Mexico

Coca-Cola FEMSA, S.A.B. de C.V. (Femsa) bottles beverages. The Company bottles and distributes branded beverages in parts of North, Central and South America. In some countries Femsa also markets water, beer, and other products.

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Coca-Cola Femsa Sab De Cv (KOFL MM)

Actinver Research - KOF 1Q25: Healthy results (Quick View)

Sales grew 10% YoY to P$70.2bn, above our estimates and consensus, and despite consolidated volumes contracting 2.2% YoY, vs our flattish...

Actinver

Actinver Research - Mexico Equity Research: 1Q25 Preview

We are updating our models ahead of 1Q25 Results; calendar headwinds and a slowdown in some industries are expected, along with FX-related effects...

Actinver

Still Favor Defensives Until Market Dynamics Improve; EURO STOXX 50 Testing Crucial 5000 Level

Still Favor Defensives Until Market Dynamics Improve; EURO $STOXX 50 Testing Crucial 5000 Level; Watch for Resistance at $105-$117.69 on $ACWI. Buy...

Vermilion Research

Actinver Research - KOF 4Q24: Solid results (Quick View)

Sales grew 14.3% YoY to P$75.5bn, above our estimates and consensus. Consolidated volumes grew 2.2% YoY, also above our estimates, driven by...

Actinver

Actinver Research - Consumer post 3Q24: Sales deceleration while trying to protect margins

Having recently launched our Food & Bev coverage (link to report here), we reiterate our Outperform ratings in beverage companies AC (PT down to...

Actinver

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