Core Insights - The company focuses on building a balanced investment portfolio that includes both technology stocks and defensive options, ensuring clients do not miss out on growth opportunities while maintaining stability [1] - Emphasis is placed on established technology companies and those in consumer staples and discretionary goods, prioritizing intrinsic company value over external circumstances [1] - The company has been actively managing third-party portfolios for seven years, with a strong focus on macroeconomic trends, stock valuation, and the interplay between politics and markets [1] Investment Strategy - The investment strategy revolves around identifying opportunities based on the intrinsic value of companies with strong catalysts [1] - The company acknowledges the challenges of the investment landscape, particularly the difficulty of "buying low and selling high" during market crises [1] Social Responsibility - The company promotes financial inclusion programs for women in finance, highlighting the importance of expanding opportunities in this area [1] - The commitment to integrating and promoting these programs is seen as a significant challenge, indicating a dedication to social responsibility within the financial sector [1]

Core Insights - Artificial intelligence (AI) is identified as the greatest investment opportunity of the current era, with a strong emphasis on the urgency to invest in AI technologies now [1][13] - The energy demands of AI technologies are highlighted as a critical concern, with data centers consuming as much energy as small cities, leading to potential crises in power supply [2][3] Investment Opportunity - A specific company is presented as a key player in the AI energy sector, owning critical energy infrastructure assets that are essential for supporting the anticipated surge in energy demand from AI data centers [3][7] - This company is characterized as a "toll booth" operator in the AI energy boom, benefiting from the increasing need for electricity as AI technologies expand [4][5] Market Position - The company is noted for its unique position in the market, being one of the few capable of executing large-scale engineering, procurement, and construction projects across various energy sectors, including nuclear energy [7][8] - It is described as debt-free and holding a significant cash reserve, which is nearly one-third of its market capitalization, providing a strong financial foundation [8][10] Growth Potential - The company also has an equity stake in another AI-related venture, offering investors indirect exposure to multiple growth opportunities in the AI sector without the associated high premiums [9][10] - The stock is considered undervalued, trading at less than seven times earnings, which presents a compelling investment opportunity given its ties to the growing AI and energy markets [10][11] Industry Trends - The article discusses the broader trends of onshoring and increased U.S. LNG exports, driven by recent tariffs, which further position this company as a beneficiary of these market dynamics [6][14] - The influx of talent into the AI sector is expected to drive continuous innovation and advancements, reinforcing the importance of investing in AI-related companies [12][13]

Core Viewpoint - Investors are particularly attracted to dividend stocks, especially those with high yields, due to their ability to provide a significant income stream and substantial total return potential [1] Group 1 - Dividend stocks are favored by investors for their income generation capabilities [1] - High-yield dividend stocks are noted for their potential to deliver substantial total returns [1]

Financial Data and Key Metrics Changes - Net revenue grew by 4% year-to-date, driven by a resilient net revenue per hectoliter growth of 7% [5][24] - EBITDA growth of 3% with a margin expansion of 50 basis points in the third quarter [5][24] - Normalized EPS increased by 8% year-over-year [5][24] Business Line Data and Key Metrics Changes - Premium and super premium brands grew mid-teens, gaining sellout market share reaching close to 50% [19] - The balanced choice portfolio grew by 36%, with non-alcohol beers expanding above 20% [7][19] - Cash COGS per hectoliter grew below net revenue per hectoliter, indicating effective cost management [6][11] Market Data and Key Metrics Changes - Brazil Beer experienced a decline in volumes, primarily due to weather conditions and consumer purchasing power constraints [12][14] - The CSD industry in Brazil saw a deceleration from low single-digit growth in Q1 to mid-single-digit decline in Q3 [20] - In Argentina, beer volumes declined mid-single digits, underperforming the industry [21] Company Strategy and Development Direction - The company aims to lead and grow the beer category by placing customers and consumers at the center of decision-making [6][8] - Digitization and monetization of the ecosystem are key pillars, with a focus on expanding the addressable market and enhancing consumer insights [9][10] - A $1 billion share buyback program was approved to return cash to shareholders, reflecting confidence in long-term value creation [6][29] Management's Comments on Operating Environment and Future Outlook - Management views the current industry headwinds as situational rather than structural, with confidence in long-term fundamentals [14][17] - The upcoming FIFA World Cup is seen as a significant opportunity to boost brand engagement and sales [31][46] - Management remains optimistic about the fourth quarter, expecting improved conditions compared to the previous year [45][46] Other Important Information - The effective tax rate decreased to 6.7% from 23.6% year-over-year, influenced by one-off effects [26] - Cash flow from operating activities totaled BRL 6.9 billion, despite softer volumes and higher cash taxes [29] Q&A Session Summary Question: Insights on COGS performance - Management attributed lower costs to a series of initiatives focused on production efficiency and cost control [35][38] Question: Beer industry environment in Brazil - Management noted that weather and consumer purchasing power were significant factors affecting volume performance, with expectations for improvement in Q4 [42][45] Question: Sustainability of SG&A reduction - Management explained that the reduction was partly due to phasing of marketing expenses and variable compensation adjustments, while also emphasizing ongoing investments in sales and marketing [57][60] Question: Pricing strategy and volume reaction - Management indicated that the price increase had minimal impact on industry performance, with a focus on maintaining prices in line with inflation [65][66] Question: Performance in Argentina and Bolivia - Management highlighted strong results in Bolivia offsetting challenges in Argentina, with confidence in long-term prospects for both markets [77][78]

Financial Performance - Normalized net income increased by 7% in 3Q25[83] - Normalized EBITDA reached BRL 384 billion in 3Q25[83] - A share buyback program of R$25 billion was approved[18,92] - R$ 6 billion in dividends announced year-to-date[92] Business Unit Performance - Brazil Beer volume declined by 77% while NR/hl increased by 57%[57] - Brazil NAB volume decreased by 86% but NR/hl grew by 100%[59] - LAS (Latin America South) experienced a volume decrease of 08% with NR/hl increasing by 100%[62] - CAC (Central America and the Caribbean) saw a volume increase of 13% and NR/hl growth of 14%[67] - Canada's volume decreased by 20% while NR/hl increased by 20%[70] Strategic Initiatives - Zé Delivery's GMV (Gross Merchandise Value) reached BRL 80 billion annualized with a 9% increase in AOV (Average Order Value)[31] - Premium & Super Premium volumes up more than 9%[26] - The company is focused on maximizing return on investments and disciplined cost management[81]

Financial Performance - Ambev reported net sales of R$63,434,834 thousand for the nine-month period ended September 30, 2025, a slight increase from R$62,417,251 thousand in the same period of 2024, representing a growth of 1.6%[15] - The gross profit for the nine-month period was R$32,322,974 thousand, compared to R$31,325,674 thousand in 2024, indicating a year-over-year increase of 3.2%[15] - Net income for the nine-month period reached R$11,458,935 thousand, up from R$9,822,371 thousand in 2024, reflecting a growth of 16.7%[15] - Basic earnings per share for the nine-month period was R$0.7141, compared to R$0.6073 in 2024, marking an increase of 17.6%[15] - Net income for the nine-month period ended September 30, 2025, reached BRL 11,458,935 thousand, a 16.6% increase from BRL 9,822,371 thousand in the same period of 2024[16] - For the three-month period ended September 30, 2025, net income was BRL 4,863,720 thousand, up from BRL 3,566,301 thousand in the same period of 2024, marking a 36.2% increase[16] - The company reported exceptional items contributing R$772,901 thousand to income from operations for the nine-month period[15] - The income from operations for the nine-month period ended September 30, 2025, was R$16,414,403 thousand, compared to R$14,278,598 thousand in 2024, representing a growth of 15.0%[90] Assets and Liabilities - Total assets decreased to R$140,754,995 thousand as of September 30, 2025, down from R$162,507,949 thousand at the end of 2024, a decline of 13.4%[13][14] - Current liabilities decreased to R$36,577,101 thousand from R$49,388,714 thousand, a reduction of 26%[14] - The company’s cash and cash equivalents decreased to R$18,309,248 thousand from R$28,595,666 thousand, a decline of 36%[13] - Ambev's total equity attributable to shareholders was R$92,027,435 thousand, down from R$98,642,139 thousand, a decrease of 6.5%[14] - The total issued capital increased to BRL 58,275,696 thousand as of September 30, 2025, from BRL 58,226,036 thousand at the beginning of the year[19] - The total amount of current and non-current recoverable taxes was R$13,472,212 as of September 30, 2025, down from R$14,086,252 at December 31, 2024, indicating a decrease of approximately 4.4%[46] - The total carrying amount of property, plant, and equipment as of September 30, 2025, was R$23,881,025, reflecting a significant reduction in value[54] - The total interest-bearing loans and borrowings decreased to R$2,894,517 million as of September 30, 2025, down from R$3,452,728 million at December 31, 2024, reflecting a decline of about 16.1%[58] Cash Flow and Investments - Cash flow from operating activities for the nine-month period was R$11,198,356, a decrease of 8.1% from R$12,184,757 in the previous year[20] - Cash flow from investing activities was negative R$2,915,701 for the nine-month period, compared to negative R$3,992,719 in the previous year[20] - The company reported net financial results of R$2,916,360 for the nine-month period, up from R$1,703,692 in 2024, reflecting a significant increase of 71.2%[20] - The company recognized a gain of R$884 million from the sale of a subsidiary, which was recorded under non-recurring items[29] - The company reported acquisitions of property, plant, and equipment totaling R$2,960,298 thousand for the nine-month period ended September 30, 2025, compared to R$3,229,988 thousand in 2024[90] Taxation and Compliance - Total income tax expenses for the nine-month period ended September 30, 2025, were R$2,030,978, a decrease from R$2,754,357 in the same period of 2024[51] - The effective tax rate for the nine-month period ended September 30, 2025, was 15.06%, compared to 21.90% for the same period in 2024[51] - The company recognized R$1,138,664 in tax incentives for the nine-month period ended September 30, 2025, compared to R$1,041,002 in the same period of 2024[96] - The company is currently challenging tax assessments regarding ICMS differences in courts, with a Supreme Court ruling in February 2025 reclassifying potential losses from possible to remote, amounting to R$0.8 billion[74] Shareholder Information - The company declared dividends amounting to BRL 5,998,726 thousand for the nine-month period ended September 30, 2025[19] - The total dividends distributed amounted to R$0.1283 per share, with the payment made on October 6, 2025[26] - The company approved dividends totaling R$5,998,726 thousand for the fiscal year 2025, with payments scheduled across three distributions[86][87][88] - The company’s issued capital as of September 30, 2025, is R$58.28 billion, with a total of 15,761,639 common shares outstanding[78] Risk Management - The company has no significant concentration of credit risk as of September 30, 2025, with counterparty risk reassessed quarterly[128] - The company’s liquidity risk is managed through cash flow from operating activities, debt issuances, and access to credit facilities[131] - The company has a dynamic interest rate hedging approach to mitigate risks associated with fluctuations in interest rates[124] Operational Highlights - The company operates in multiple segments, producing and selling a variety of beverages, including beer and soft drinks, across Latin America[21] - The company has commitments to suppliers for inventory amounting to R$27,096,091 as of September 30, 2025, down from R$46,942,988 at December 31, 2024[141] - Key management personnel remuneration totaled R$136,942 for the nine-month period ended September 30, 2025, compared to R$123,008 for the same period in 2024[146]

Core Insights - Ambev (ABEV) is currently more attractive to value investors compared to Diageo (DEO) based on Zacks Rank and valuation metrics [1][2] Valuation Metrics - ABEV has a Zacks Rank of 2 (Buy), while DEO has a Zacks Rank of 4 (Sell), indicating a stronger earnings outlook for ABEV [2] - ABEV's forward P/E ratio is 12.51, compared to DEO's forward P/E of 14.44, suggesting ABEV is undervalued relative to DEO [4] - ABEV has a PEG ratio of 2.20, while DEO's PEG ratio is significantly higher at 4.26, indicating ABEV's expected earnings growth is more favorable [4] - ABEV's P/B ratio is 2.1, whereas DEO's P/B ratio is 4.06, further supporting ABEV's valuation advantage [5] - ABEV's overall Value grade is A, while DEO's Value grade is C, highlighting ABEV's superior valuation metrics [5]

Core Insights - The stock market is experiencing a bullish trend in Q4 2025, with several investment opportunities under $10 that may offer attractive entry points based on valuation [1] - Companies highlighted include Ambev S.A. and Snap, both of which have solid fundamentals despite their low share prices [2][6] Ambev S.A. (NYSE: ABEV) - Ambev is trading around $2 per share and is considered a defensive favorite in a volatile economy, supported by steady profit margins and a low debt balance sheet [2][3] - The company reported a 7.5% increase in quarterly profit, although overall volumes declined due to currency challenges and cost pressures [3] - Analysts estimate ABEV is trading 25% to 30% below its fair value, with profit margins and cash flow metrics outperforming many global beverage peers [3] - ABEV's stock was up 0.90% at $2.25, marking a year-to-date gain of 21% [4] Snap (NYSE: SNAP) - Snap is currently trading just under $10 and has faced challenges since its post-pandemic highs, but management's focus on monetization and AI-driven ad tools is yielding positive results [6][7] - The company reported $1.3 billion in revenue for the most recent quarter, a 16% year-over-year increase, while also narrowing its losses through cost-cutting measures [7] - Snap's Monthly Active Users reached 932 million, which could support revenue growth, especially with increased advertising spending during the holiday season [8] - Despite a nearly 30% decline year-to-date, trading at $7.65, improving fundamentals may present a turnaround opportunity for investors [8]

Group 1 - Ambev S.A. is considered one of the best penny stocks to buy according to hedge funds, despite Goldman Sachs reducing its price target to R$10.10 from R$10.20 while maintaining a Sell rating [1] - The latest industrial product data from IBGE indicates a 12% decrease in alcoholic beverage production in Brazil for August, averaging a 13% year-over-year contraction quarter-to-date and a 4% drop over the past 12 months [2] - Ambev S.A. operates in three geographical segments: Brazil, Central America and the Caribbean (CAC), and Canada [3] Group 2 - The company produces, distributes, and sells a variety of beverages, including carbonated soft drinks, beer, and other non-alcoholic and non-carbonated products [2] - There is a belief that certain AI stocks may offer greater upside potential and carry less downside risk compared to Ambev S.A. [3]

Core Viewpoint - Ambev (ABEV) is currently viewed as a better value opportunity compared to Diageo (DEO) based on various financial metrics and Zacks Rank analysis [1][7] Valuation Metrics - ABEV has a forward P/E ratio of 12.29, while DEO has a forward P/E of 14.02, indicating ABEV is more attractively priced [5] - ABEV's PEG ratio is 2.16, compared to DEO's PEG ratio of 3.42, suggesting ABEV offers better value when considering expected earnings growth [5] - ABEV's P/B ratio stands at 2.06, significantly lower than DEO's P/B ratio of 4.03, further supporting ABEV's valuation advantage [6] Earnings Outlook - ABEV is currently exhibiting an improving earnings outlook, which is a positive indicator in the Zacks Rank model [3][7] - The Zacks Rank for ABEV is 2 (Buy), while DEO holds a Zacks Rank of 4 (Sell), reflecting a more favorable investment sentiment towards ABEV [3]