A-B shares upgraded by Bear Stearns analyst

Modern Brewery Age,  March 20, 2006  

Tags: Bear Stearns & Co. Inc.

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Bear Stearns beverage analyst Carlos Laboy upgraded shares of Anheuser-Busch this past week, from "underperform" to "peer perform."

Laboy said the brewer would likely do better this year, citing A-B's deluge of new specialty products, the acquisition of import rights for Grolsch and Tiger, and the likelihood that the brewer's sales have nowhere to go but up.

In a note to investors, Laboy wrote, "We believe Anheuser-Busch's fundamental story is growing stronger and should improve materially by 2007."

LaBoy said that the brewer's new brands, including Budweiser Select and Michelob Ultra Amber, are performing well.

He also said that the brewer should benefit from a move into the Russian market, in company with Heineken.

LaBoy noted that overall shipping volume rose 3.4% in January and February, and pricing appears to be stabilizing after a period of rampant discounting. At present, he said Anheuser-Busch and Molson Coors are less vulnerable to continued discounting than SABMiller, which has more sub-premium exposure.

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