Ryan Bushell Molson Coors Brewing Company TAP-N COMMENT Oct 03, 2017

Brewers are struggling with declining sales. Valuation is still on the rich side, mainly because of declining margins. Doesn’t have EM exposure that you’d like to see. Be cautious. Compares poorly to its peers. (Analysts’ price target is $77.43.)

This is one of the top brewers, but like all the others in the beer industry, Molson Coors is struggling. Their market is extremely mature, with declining consumption. Molson has bought some craft brewers but those companies are getting expensive. Very low multiple and generates good cash flow. They are using free cash to pay down debt. But it's difficulty to find new ways to grow. It's a tough call to say to buy because the company looks relatively cheap, well-managed but maybe not likely to grow much. They're entering into joint ventures with cannabis companies, experimenting with infused beverages. He is not sure how big the market will be for these products. It might get very crowded very quickly. For the next few years, for Molson Coors, these are small projects--tiny in the grand scheme of things.

Growth has slowed in recent months and people here and abroad have turned hard against alcohol.

He's shocked by their 24% decline in the last 3 months. The street believes that all their drinks will be hurt by the popularity of the GLP-1 weight-loss drugs, but he disagrees. He would buy more shares, but it's hard to buck the GLP-1 trend.