Brown-Forman Corp Registered Shs -B- Non Vtg

BF.B: XNYS (USA)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	$67.00	Zvnyy	Mxgjyncrts

Brown-Forman Earnings: Weak Consumer Sentiment Weighed on Sales but Premiumization Still a Tailwind

Dan Su

Aug 30, 2024

We plan to maintain our $55 fair value estimate for wide-moat Brown-Forman after absorbing its fiscal 2025 first-quarter results. While organic sales fell by 4% and earnings per share contracted 14%, we expect performance to improve in the second half due to product innovation and stepped-up marketing. We see no need to change our 2025 estimates, which align with management’s outlook for 2%-4% organic growth in sales and operating income and our 10-year forecasts for mid-single-digit annual sales growth and low-30s average operating margins. Shares look undervalued.

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