BF/B

Brown-Forman Corp.

Consumer


Presented:12/18/2019
Price:$64.92
Cap:$31.02B
Current Price:$48.73
Cap:$23.03B

Presented

Date12/18/2019
Price$64.92
Market Cap$31.02B
Ent Value$33.75B
P/E Ratio36.5x
Book Value$4.06
Div Yield0.98%
Shares O/S477.85M
Ave Daily Vol1,259,556
Short IntN/A

Current

Price$48.73
Market Cap$23.03B
Brown-Forman Corp. engages in the production and distribution of alcoholic beverages. The firm offers whiskey, scotch, tequila, vodka, liquer, and wine. Its brands include Jack Daniel, Woodford Reserve, Old Forester, Early Times, Canadian Mist, Coopers' Craft, Slane Irish, Finlandia, Korbel, El Jimador, Sonoma Cutrer, and Chambord. The company was founded by George Garvin Brown III in 1870 and is headquartered in Louisville, KY.

Publicly traded companies mentioned herein: Brown-Forman Corp (BF/B), Davide Campari-Milano SpA (CPR IM), Diageo plc (DEO), Kirin Holdings Co Ltd (2503 JP)

Highlights

The presenter is short shares of Brown-Forman Corp (BF/B) due to a glut in whiskey supply, pricing issues, and high year-end expectations despite lackluster results. The spirits distiller’s stock, despite EPS estimates staying flat and missing guidance almost every quarter last year, has appreciated 35% this year, with a multiple expansion from 27x to 35x. The presenter believes the advance in BF’s stock and a difficult guidance target for FY2020 coupled with ongoing structural threats presents a 40% downside opportunity, assuming his expected rerating of the multiple to the low 20s.

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Idea Discussion

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