oldjoe1
19 Jan 2018
Re: FEVR, Broker Comment...... [link]
oldjoe1
19 Jan 2018
Re: FEVR, Broker Comment...... FEVR...... More here from broker Morgan Stanley.......With high growth potential and attractive returns, we seeFever-Tree as a unique opportunity in European Staples. Ourchannel checking and proprietary industry model suggest thepremium mixers market could triple in the next 5 years withFever-Tree well placed to capitalise on this growth.Fever-Tree's performance to date has been impressive. The company effectivelycreated the premium mixers category, giving consumers more choice and a higherquality product, with better cash margins for the on-trade and a high rate ofsales in the retail channel. Drawing on our extensive channel checking, we expectthe premiumisation of mixers to continue and see Fever-Tree as well placed tocapitalise on this growth despite increased competition.The penetration of premium mixers is currently 9% of the total mixers marketversus 33% for premium spirits, the closest proxy for mixers. Our industry modelassumes further penetration of premium mixers, driving a ~20% CAGR 2017-25across Fever-Tree's core markets. This growth underpins our forecasts for 23%revenue CAGR, 20% EBITDA CAGR and 20% EPS CAGR between FY17-20Fever-Tree employs an asset light business model. It does not own itsmanufacturing and relies on third parties for distribution. The group thus hasimpressive returns on invested capital, which we estimate to grow sustainablygoing forward from 43% in FY16 to 63% by FY20, while FCF should double.We think the growth potential for Fever-Tree is underappreciated (particularlyby sell-side consensus), and we view Fever-Tree's asset light, high returnsbusiness model favourably. We set our £30.00 price target based on our DCFmethodology, with the risk reward skewed to the upside, in our view. Increasedcompetition or a slower penetration of premium mixer than we are currentlyexpecting are key risks to our rating and price target.
Cantseethewoodsforthetrees
19 Jan 2018
Re: Jeffries Bullish Coverage Today Newcomer Jefferies quotes a target price of £30. No other analysts have quoted a price anywhere near that-so far.But it seems that 'investors' are prepared to pay £3to £4 more today than yesterday on no new news (from the company).Is this PIs getting sucked in? Surely not institutional buying?All will jo doubt be revealed in the update on the 24th.
Chicken Lips
19 Jan 2018
Jeffries Bullish Coverage Today Shares in Fevertree Drinks PLC (LON:FEVR) popped at the open on Friday after US investment bank Jefferies kicked off its coverage of the posh tonic maker with a bullish ‘buy’ note.Fever-Tree has seen its market value more than double over the past year and Jefferies analyst Edward Mundy reckons there’s still plenty of fizz left, setting a punchy price target of £30.READ: Fever-Tree regains its fizz after lifting profit expectations“We see growth in tonics driving a standalone value per share of 2500p and bake in a further 500p on a 20% probability FEVR can capitalise on the non-tonic mixers category,” he wrote on Friday.As Mundy points out, tonics are the AIM-quoted firm’s bread and butter but more recently management has started to branch out into other areas such as cola and ginger beer as they look to crack the US where ‘dark liquor’ is king.Success in non-tonic business could add £25 to shares​The analyst estimates the premium dark spirits market to be ten times the size of gin, meaning there’s a lot of money to be made if Fevertree is successful.“There is a significant upside opportunity if FEVR can own and develop the premium mixer market, where current market leaders are less focused on the mixer occasion. We see upside of as much as £25 if FEVR is successful with its non-tonic strategy.”Keeping up with the potential rise in demand for its tonics and other mixers shouldn’t be too difficult either as Mundy reckons the company was “designed from the start to be exponential”.“Unlike the traditional bottler model, FEVR has no manufacturing assets with production/distribution outsourced. This offers flexibility, scalability, limited capex and strong cash generation.”Competition only real riskThe analyst does note that competition is Fever-Tree’s “single biggest threat” as the likes of Schweppes and Britvic try to take a chunk of this emerging and lucrative premium mixer market.“We would highlight competition from above (eg Schweppes), competition from below (eg Fentimans) as well as the risk of mixologists creating their own tonic waters.“[However] FEVR has first mover advantage in terms of credibility, bar tender endorsement, brand awareness, penetration (20k on-trade outlets in UK), and trade contacts.”Shares soared 8.3% to £23.52 early on Friday.[link]
Chicken Lips
19 Jan 2018
Re: SP Movements today takeover here you go Todays TelegraphCity whispers speculating that consumer goods giant Unilever is set to swoop for rising star Fevertree Drinks caused the upmarket tonic water maker’s shares to fizz on London’s junior market.Swirling rumours mooted that Unilever will try to snap up the posh drink mixers company to help lift its ailing growth but will have to pay at least £28 per share for the investor darling, valuing the company at more than £3.2bn. The rumour mill swung into action after Fevertree appointed Kevin Havelock, Unilever’s global president of Refreshment, as a non-executive director last week.With Fevertree relying on distribution deals outside of the UK, its growth could be catapulted by Unilever’s wide reach, and synergy savings would also be created by a tie-up, one analyst argued. However, Unilever’s preference to trade with supermarkets and wholesalers rather than Fevertree’s clientele of mainly restaurants and bars lessens its appeal.Drinks giants Diageo and Pernod Ricard were also rumoured to be in the hunt for the company as a perfect tonic to their alcoholic drinks ranges, but the Aim-listed company’s collaborations with a wide array of drink manufacturers could prove a stumbling block to a bid.Drinks giants might not be willing to continue existing collaborations with Fevertree if it was snapped up by a rival, possibly stunting its growth, and soft drinks suitors could face a tricky path to a deal by competition laws.Fevertree has been transformed from a market minnow into the fourth-largest company by market capitalisation on the Aim market as the gin craze sweeps the UK, lifting its shares by 307pc in just two years. Shares jumped a further 50p to £21.72 on City chatter over a tie-up.[link]
allywm
19 Jan 2018
Re: SP Movements today Rumours circulating about a possible bid by Unilever.
Tatty
19 Jan 2018
SP Movements today Big up then down almost like a P&D this morning but I suspect a leak about a likely trading update next week?
Marcus Ponds
16 Jan 2018
Re: opened a nice short on this 'huge share of the market' What percentage?
danners
16 Jan 2018
Re: Nice plug for Fevertree on BBC 2 yes, i noticed that. Probably better publicity that an ad on a commercial channel.
Bribon
15 Jan 2018
Nice plug for Fevertree on BBC 2 During the programme called “At the Edge of Life” one surgeon was saying, after a successful operation, that he was looking forward to a nice gin toped up with Fevertree tonic.Not bad for the BBC!
Cantseethewoodsforthetrees
10 Jan 2018
Re: opened a nice short on this Latest RNS-Old Mutual reducing
Chicken Lips
10 Jan 2018
Re: opened a nice short on this Whats your short position?Its certainly becoming more volatile. When I first got into FEVR it only went one way. North.
one4all
10 Jan 2018
opened a nice short on this with market cap 20 times turnover this has got a wayyyyy ahead of it self .divi for the year will be about 12p and its already has a huge share of the market. no room to grow further and USA is a very difficult market to break
Cantseethewoodsforthetrees
09 Jan 2018
Today's RNS Have Fidelity upped their stake?
oldjoe1
27 Dec 2017
FEVR Strong Technical Breakout....... FEVR Fevertee Drinks ..breaking out through the down trend channel and momentum fully behind it. Reported XMAS trad update 25th January last year. Should get an update on the refocusing on the US market.[link]
