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Daily Trading Brief: Compania De Las Cervecerias Unidas

|About: Compañía Cervecerías Unidas S.A. (CCU)
Summary

The historical performance should leed to above-average price performance in the next one to three months.

Compania Cervecerias Unidas S.A. operates as a beverage company principally in Chile, Argentina, Uruguay, Paraguay, Colombia, and Bolivia.

CCU's revenue growth has slightly outpaced the subsector average of 4.1%.

CCU OVERVIEW

Compania Cervecerias Unidas S.A. operates as a beverage company principally in Chile, Argentina, Uruguay, Paraguay, Colombia, and Bolivia. The company operates through three segments: Chile, International Business, and Wine. It produces and sells alcoholic and non-alcoholic beer under proprietary and licensed brands, as well as distributes Pernod Ricard products in non-supermarket retail stores.

The company also produces and sells non-alcoholic beverages, including carbonated soft drinks, nectars and juices, sports and energy drinks, and ice tea, as well as mineral, purified, and flavored bottled water. In addition, it is involved in the production and distribution of wine, cider, and spirits. The company serves small and medium-sized retail outlets; retail establishments, such as restaurants, hotels, and bars; wholesalers; and supermarket chains.

Compania Cervecerias Unidas S.A. also exports its products to Europe, Latin America, the United States, Canada, Asia, Oceania, and internationally. The company was founded in 1850 and is based in Santiago, Chile. Compania Cervecerias Unidas S.A. is a subsidiary of Inversiones y Rentas S.A.

WEEKLY CHART

HIGHLIGHTS

  • CCU's revenue growth has slightly outpaced the subsector average of 4.1%. Since the same quarter one year prior, revenues slightly increased by 8.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • CCU's debt-to-equity ratio is very low at 0.26 and is currently below that of the subsector average, implying that there has been very successful management of debt levels.
  • COMPANIA CERVECERIAS UNIDAS reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, I feel it is poised for EPS growth in the coming year. During the past fiscal year, COMPANIA CERVECERIAS UNIDAS reported lower earnings of $1.11 versus $1.14 in the prior year. This year, the market expects an improvement in earnings ($1.23 versus $1.11).

FINAL NOTES

CCU stock price is down 7.7% in the last 12 months, down 14.2% in the past quarter and down 11.8% in the past month. The historical performance should leed to above-average price performance in the next one to three months. 

Disclosure: I/we have no positions in any stocks mentioned, but may initiate a long position in CCU over the next 72 hours.