News

News

Molson Coors Brewing shares seemingly undervalued

Barron's, one of the world's leading business publication, released in it s November 3 Edition, Molson Coors shares appear to be undervalued after falling with the broader market. Some analysts contend that Coors Light can sustain its nice growth, sharply boosting Molson Coors stock (which closed at $37.36 on Friday on the New York Stock Exchange) over the next year up to about 60 US-Dollars. Sales of their flagship Coors Light beer rose 6.8% from July through September, while the overall beer market's gain of less than 1%.

The bulls also are betting a sales and distribution venture with SABMiller could help earnings as well, with market share gains and significant cost savings potentially creating double-digit earnings growth. The venture, MillerCoors, has $7B in revenue, can produce around 70M barrels through eight breweries, and has nearly 30% of the U.S. market. Last quarter Molson Coors had some problems because of high ingredient costs and weaker than expected Canadian and British businesses. But now, according to Barron's, reports of higher earnings for the third quarter are expected. Barron s wrote: "As the economy slumps, millions of Americans are crying in their beer, and for a growing number, that beer is Coors Light." Last year, Molson has $6B of net revenue and produced nearly 1.6B gallons of beer. This makes it the world's sixth-largest brewer, and it is tied for the first-place slot in Canada.

written on 05.11.2008 um 06:10.

*

[overview]