Corona lockdowns in Vietnam are negative for Heineken, but the outlook for the Amsterdam Brewer remains favorable. This is what analysts from Credit Suisse write Wednesday.
In 2019, the Asian country accounted for about 12 percent of Heineken’s profits. And the measures against the coronavirus in Vietnam therefore put a brake on the stock, according to Credit Suisse, which is also counting on a lower volume growth.
The bank reduced its estimate for autonomous volume growth in 2021 from 6.8 percent to 5.8 percent. The consensus is 6.6%.
“But our estimate for autonomous sales growth of 12.9 percent in 2021 is in line with the consensus and we are more positive about the price mix,” according to Credit Suisse’s analysts.
The bank did not change the profit forecast for 2021, but also for 2022 and 2023. This makes Credit Suisse 6 to even 14 percent more optimistic than the consensus.
“Looking at 2022, we think the market is underestimating Heineken’s price power and the scope to manage the pressure of higher raw material costs.”In addition, the bank expects coronavirus restrictions in Vietnam to ease in the fourth quarter as vaccination rates rise.
Credit Suisse has an Outperform advice at Heineken with a price target of 123.00 euro. The share increased 1.3 percent to 93.90 euros on Wednesday.