Molson Coors's stock falls on 'cautious' outlook despite profit beat

MW Molson Coors's stock falls on 'cautious' outlook despite profit beat

By Steve Gelsi

Brewer cites strong volume in the Americas in the first quarter but faced challenges in April

Molson Coors Beverage Co.'s stock fell Tuesday on the beer maker's cautious outlook despite a "strong start" to the year.

While it nearly tripled its first-quarter net income on a 10.7% jump in revenue, Molson Coors $(TAP)$ did not hike its outlook for the year.

Molson Coors's stock dropped 6.6% Tuesday.

Roth MKM analyst Bill Kirk said the company's guidance after a stronger-than-expected first-quarter result implies a roughly 2% drop in year-over-year profit performance for the remainder of the year.

Scanner data from April - after the first quarter - has shown that Molson Coors "appears to be losing some market share," Kirk said.

The company said it is "incrementally more cautious on the outlook for the industry this year given early April industry performance."

Molson Coors said its first-quarter net income rose to $207.8 million, or 97 cents a share, from $72.5 million, or 33 cents a share, in the year-ago quarter.

Adjusted profit rose to 95 cents a share from 54 cents a share, well ahead of the FactSet consensus estimate of 74 cents a share.

Revenue rose to just under $2.6 billion from $2.35 billion in the year-ago quarter and beat the analyst estimate of $2.5 billion.

"Strong Americas volume and favorable net pricing across both business units resulted in double-digit top-line growth, while volume leverage and ongoing cost savings drove meaningful margin expansion in the quarter," the company said.

Molson Coors cited double-digit brand-volume growth for its Coors Light and Coors Banquet lines, as well as high single-digit brand-volume growth for Miller Lite in the U.S.

"Our above-premium portfolio, including both beer and beyond beer, benefited from continued growth from winning innovations like Madri in the U.K. and Simply Spiked in the U.S. and Canada," the company said.

Looking ahead, Molson Coors said it continues to expect 2024 net sales to increase by low single digits over 2023 on a constant-currency basis.

Prior to Tuesday's trading, Molson Coors's stock was up 3.8% so far in 2024, compared with a 7.3% gain by the S&P 500 SPX.

-Steve Gelsi

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April 30, 2024 11:01 ET (15:01 GMT)

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