AB InBev's Q4 Earnings on Deck: What Surprise Awaits Investors?

Core Viewpoint - AB InBev is expected to report declines in both revenue and earnings for the fourth quarter of 2024, influenced by challenging macroeconomic conditions and rising costs [1][4][5]. Revenue and Earnings Estimates - The Zacks Consensus Estimate for AB InBev's quarterly revenues is $14.4 billion, reflecting a 0.2% decrease from the previous year [2]. - The consensus estimate for earnings per share is 72 cents, indicating a 12.2% decline from the prior-year figure [2]. Recent Performance - In the last reported quarter, AB InBev's earnings per share exceeded the Zacks Consensus Estimate by 8.9%, with a trailing four-quarter average earnings surprise of 8.2% [3]. Factors Impacting Q4 Results - The upcoming quarterly results are likely to be affected by a soft consumer environment in China and Argentina, as well as currency and interest rate fluctuations [4]. - Commodity cost inflation and increased supply-chain expenses are expected to contribute to higher costs, with a projected 5.7% rise in the cost of sales and an 8.9% increase in SG&A costs year over year [5]. Strategic Initiatives - AB InBev's focus on premium beer offerings and the expansion of its Beyond Beer portfolio are seen as positive factors that may cushion performance [6]. - Investments in B2B platforms, e-commerce, and digital marketing are also expected to support the company's growth strategy [6]. Valuation and Stock Performance - The stock has a forward 12-month price-to-earnings ratio of 14.65X, compared to a five-year high of 25.58X and the industry average of 14.07X [8]. - Over the past six months, AB InBev shares have declined by 12.8%, which is better than the industry's 18.6% decline [8].