Overview
- Brazil and Mexico were knocked out of the World Cup on Sunday, July 5, removing the late-tournament matches that normally drive extra beer consumption in those countries.
- Morgan Stanley analysts led by Sarah Simon say that the loss is likely to erase incremental beer-volume growth in Latin America for Q3 rather than cut baseline consumption.
- The bank identified Anheuser-Busch InBev as the most exposed brewer because of its large sales in Brazil and Mexico, with Heineken also materially exposed.
- Investors reacted quickly with single-day share declines: AB InBev down about 4%, Heineken down about 1.4%, Constellation Brands down roughly 5–6%, and Ambev down about 3.5%.
- A strong U.S. run could partially offset lost Latin American demand because the U.S. is about 20% of AB InBev’s revenue, but Morgan Stanley says it is unclear whether U.S. results would fully close the gap and investors will watch the remaining matches ahead of the July 19 final.