Anheuser-Busch InBev (NYSE: BUD), the owner of Bud Light, has experienced a continued decline in sales for the sixth consecutive week following a social media promotion involving influencer Dylan Mulvaney.
Industry data research reveals that sales plummeted 24.6% for the week ending May 13 compared to a year ago. These declining sales, along with other challenges faced by Anheuser-Busch, have had a noticeable impact on the company’s stock price, which has dropped by nearly 12% over the past month.
In light of the ongoing boycott of Bud Light and its repercussions on the parent company, Finbold has sought the perspectives of prominent finance experts to gauge the potential performance of BUD stock by the end of 2023.
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Holmes Osborne, CFA at Seeking Alpha
In an astute observation by Holmes Osborne, CFA, a recognized contributor at Seeking Alpha, it becomes evident that Anheuser, the parent company of Bud Light, holds a significant portion of its sales within the Latin American market.
This crucial detail seems to elude many analysts who overlook the impact of Latin American economies and currencies, which have endured a prolonged period of weakness.
“The latest controversy is infinitesimal compared to its problems in Latin America. Rising costs in aluminum and commodities, weak currencies, and little pricing power have killed the stock.”
Asher Rogovy, Chief Investment Officer at Magnifina
Asher Rogovy noted:
“I doubt the culture war will affect AB InBev in the long run. AB InBev, which resulted from the merger between Anheuser-Busch and InBev, distributes over 500 beer brands worldwide. North America accounts for roughly 28% of sales. As shown in videos posted by irritated consumers, they pledged to switch to a beer brand that was also owned by AB InBev.”
The esteemed Chief Investment Officer observed that AB InBev, is significantly more impacted by economic factors rather than political controversies.
As the stock market outlook remains ensconced in a cloud of uncertainty, AB InBev finds itself confronting challenging headwinds emanating from both the overall state of the economy and the ramifications of heightened interest rates triggered by inflationary pressures.
“AB InBev’s global footprint only complicates matters. Before seeing much higher stock prices, I’d predict that BUD will increase its dividend.”
L. Burke Files, Senior Researcher for Unicus Research LLC
Senior researcher L. Burke Files presents an end-of-year price projection for BUD stock at $42.25. In his analysis, he acknowledged the presence of increased volatility within Anheuser-Busch stock. Nonetheless, they highlight that the company boasts a diverse portfolio of well-regarded brands.
“The political endorsement was a colossal blunder of virtue signaling. Markets abhor signaling either on the right or left. Anheuser-Busch – is now having to buy back expired beer, sales are off by 26%, and the distributor network is, to say the least, not pleased.”
He added:
“Bud Light is a mortally crippled brand unless Anheuser-Busch decides what customers they are going to serve. It will be a delicate moment, and they will have to get the message just right, not make it worse.”
Christopher William, CPA finance expert
Finally, Christopher William, a seasoned CPA finance expert, offers a more optimistic perspective compared to other analysts when it comes to the projected stock price of BUD. William confidently predicts that by the end of December 2023, the BUD stock price will range between $50 and $55 per share.
This positive outlook is primarily based on the company’s robust fundamentals and its adeptness in navigating the challenges posed by the current market landscape.
One key aspect that bolsters William’s prediction is the company’s proactive investment strategies. Anheuser-Busch has been actively allocating resources toward the development of new product lines, expanding into untapped markets, and fortifying its presence in existing markets.
“The company has been actively investing in new product lines, expanding into new markets, and increasing its presence in existing markets. I believe that these investments will pay off in the future and result in increased stock prices.”
In addition to the company’s strategic initiatives, William acknowledges Anheuser-Busch’s proactive engagement with the public and its commitment to addressing the concerns raised by recent controversies.
“The company is actively engaging with the public and addressing the issues raised by the recent controversy. This proactive approach towards addressing customer concerns will further improve relationships with customers and create a more positive outlook for the company.”
BUD stock chart analysis
Over the past month, the stock price of BUD has exhibited a wide trading range, fluctuating between $57.41 and $66.32. Presently, the stock is hovering near the lower end of this range, with a current trading value of $57.60. This recent dip indicates a decline of -$8.05 (-12.26%) in the past month.
Notably, there exists a support zone within the range of $57.41 to $57.59, which encompasses multiple trend lines across various time frames. This support zone signifies a level at which the stock has historically demonstrated resilience and potential buying interest from investors.
Conversely, a resistance zone ranging from $65.53 to $66.73 indicates a range at which the stock has encountered obstacles and faced selling pressure in the past.
Taking into account the current trading price and the wider trading range, it is evident that BUD has experienced a notable decline in value over the past month, impacted by the sustained Bud Light impact the boycott has had on Anheuser-Busch.
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