NEW YORK (TheStreet) -- Molson Coors Brewing (TAP) shares closed the day up 2.3% to $74.86 on very heavy trading volume after being upgraded to "equal weight" by analysts at Morgan Stanley (MS) on Friday.
The upgrade came on reports of a possible acquisition attempt by Anheuser-Busch InBev (BUD) that could be of some strategic value to the Colorado beer maker.
"We believe that a focus on strategic potential in general in the consumer packaged goods space, and recent press reports regarding a potential Anheuser-Busch InBev (BUD) acquisition of SABMiller, has caused the market to assign a greater strategic value to TAP, which we believe is sustainable," said Morgan Stanley.
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TheStreet Ratings team rates MOLSON COORS BREWING CO as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:
"We rate MOLSON COORS BREWING CO (TAP) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, compelling growth in net income, expanding profit margins and good cash flow from operations. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Powered by its strong earnings growth of 456.25% and other important driving factors, this stock has surged by 44.09% over the past year, outperforming the rise in the S&P 500 Index during the same period. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
- MOLSON COORS BREWING CO reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, MOLSON COORS BREWING CO increased its bottom line by earning $3.02 versus $2.43 in the prior year. This year, the market expects an improvement in earnings ($4.29 versus $3.02).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Beverages industry. The net income increased by 473.3% when compared to the same quarter one year prior, rising from $28.50 million to $163.40 million.
- 44.53% is the gross profit margin for MOLSON COORS BREWING CO which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 20.02% is above that of the industry average.
- Net operating cash flow has increased to $149.70 million or 26.43% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -9.55%.
- You can view the full analysis from the report here: TAP Ratings Report
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