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ALSEA - Consumer Play In Mexico Up Over 10% In 2 Weeks - Further To Run - Target $75

|Includes: Alsea SA (ALSSF), SBUX

ALSEA is the franchisor for Starbucks (SBUX), Domino's and Burger King in Mexico.

The shares sold off in the wake of Trump's election but have begun to rebound. The shares are up over 10% in the past two week and we beleive they have a lot further to move.

At MXP63 the shares trade at just PEG ratio of just 1.3 (versus 1.8x for SBUX) and an EV/EBITDA of 12x (versus 17x for SBUX). They pay a healthy dividend (1.6% DivYld) and over the past 5 years they have posted earnings growth of 25% on revneue growth of 4%.

The company is widely held by international investors including T. Rowe Price and Thornburg.

With new management recently added from WalMart of Mexico and some exciting initiatives in the pipeline we belive ALSEA has further to run.

At MXP75 (20% upside) the shares would be at just 17x our 2019 estimates.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.