Molson Coors Shares Ride UBS Upgrade Buzz

Molson Coors Brewing (TAP) shares took another step up Wednesday, rising more than 5% intraday, following an upgrade in the stock's rating from UBS analyst Kaumil S. Gajrawala.

He upgraded his rating on the stock from "neutral" to "buy," and left his $106 price target unchanged.

Mr. Gajrawala told clients that Molson Coors stock valuation has become increasingly attractive in the past few weeks given its 12% decline since May.

The analyst also said that the company continues to show volume strength and solid pricing in the U.S., while Canadian operations are verging on a turnaround.

"Coors has demonstrated that U.S. beer can grow through more effective marketing, strong distributor relationships, and effective retail execution – as indicated by Coors Light trends. Given the increased scale and complexity of the Canadian business, we believe that Coors is just now starting to gain traction in this region."

On Monday, shares in Molson Coors dropped on news the company was refinancing its debt, but rebounded a day later after analysts, including Goldman Sachs' Judy Hong, chimed in, saying the refinancing plans were a positive move for the company.

TAP 1-yr chart: