Is Ambev (ABEV) One of the Cheap Penny Stocks to Invest In?

Group 1 - Ambev is considered a cheap penny stock, with Barclays maintaining a Hold rating and a price target of $2.5, while Bernstein downgraded it to Market Perform with a price target of $2.88 due to valuation concerns after a 16% year-to-date gain [1][2] - In Q3 2025, Ambev's premiumization strategy led to over 9% growth in volumes for premium and super-premium brands, capturing nearly 50% market share in Brazil [2] - The company's digital ecosystem showed significant growth, with the marketplace initiative's GMV increasing 100% to an annualized BRL 8 billion, and the DTC platform Ze Delivery seeing a 7% GMV increase [2] Group 2 - Despite positive developments, Ambev faced challenges such as softer beer industry volumes in Brazil due to unseasonably cold weather and constrained consumer purchasing power, along with a mid-single-digit decline in Argentina's beer volumes [3] - Financially, Ambev reported a normalized net income of BRL 3.8 billion (up 7%) and a stated net income of BRL 4.9 billion, representing a 36% increase year-over-year [3] - Ambev operates in the production, distribution, and sale of various beverages across Brazil, Central America, the Caribbean, and parts of Latin America and Canada [4]