RBC upgrades Heineken, Carlsberg to 'Outperform' on sober outlook

Heineken Holding NV

14/03/2025 06:40

** RBC upgrades Heineken HEIO.AS and Carlsberg CARLb.CO to "Outperform" from "Sector perform" saying the brewers have avoided setting an overly optimistic guidance in uncertain times

** "We were initially surprised, then increasingly bemused, by the preponderance of consumer companies setting guidance for 2025 based on the assumption that consumer markets/confidence will gather impetus as the year progresses", the broker says

** The brewers' more cautious forecasts, combined with relatively low valuations, limited exposure to tariffs and growth plans are reasons to upgrade the stocks, the broker says

** "It feels like a compelling investment proposition" for the two companies and "Outperform"-rated AB Inbev ABI.BR, it adds

** "Carlsberg is the only company in our coverage that has no exposure to a softened consumer backdrop and tariff risks in the US.", RBC says

** Heineken will continue to invest behind growth, justifying a conservative assessment that its EBIT margin will remain flat in the next three years, it says

** As of Thursday's closing, shares in Carlsberg have gained 29% YTD, Heineken is up 13% and AB Inbev 18%, outperforming the European food and beverages index .SX3P which gained about 6%

 (Reporting by Alessandro Parodi)

 ((alessandro.parodi@thomsonreuters.com))