DVCMY - Davide Campari: Full Valuation And A Potentially Tough Q1

2024-04-19 11:13:40 ET

Summary

• After 18 years, there is now a new CEO at Campari.
• Campari acquired the premium Cognac house Courvoisier. Cognac is now the fourth axis of the development of Campari Group products.
• We see a potentially challenged Q1 with positive expectations in H2. Therefore, we maintain a neutral view.

Last year, we initiated Davide Campari-Milano N.V. ( DVDCF ) with an analysis called We Pass For Now . Since then (June 2023), the company stock's price has been down by approximately 28%. Despite recognizing Campari has a quality business, the company was trading at a 45% premium versus its large-cap spirit (Diageo (DEO) and Pernod Ricard (PDRDF)). This was also one of the main reasons we decided to start a long position in Diageo: LatAm Recovery And Destocking Activities Make This A Strong Buy and increase our investment in Heineken (HEINY) ( We Still Like Beers )....

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