E-Malt.com News article: 4559

USA: The shares of Molson Coors Brewing Co. were snapped up by investors on Monday, March 28, after the investment bank Credit Suisse First Boston (CSFB) predicted its stock could strengthen 30 % this year as the newly merged company continues to develop high-margin markets, Associated Press communicated on March 28. CSFB raised its rating to "Outperform" from "Neutral," and raised its 12-month price target for the stock to $100 from $80. The investment bank also raised its 2005 earnings forecast to $4.85 per share from $4.75, and increased its 2006 forecast to $5.79 per share from $5.36.

Analysts surveyed by Thomson First Call expect Molson Coors to report earnings per share of $4.89 in 2005, and $5.62 the following year. "As a standalone company, Coors was the levered play on the U.S. beer industry," CSFB analyst Corey Horsch said in a report to clients. "Investors favored the shares when industry volume and pricing growth were accelerating, and avoided the shares when industry conditions were difficult."

The stock has bounced around quite a bit since it opened for trade at $75.65 on Feb. 9 - the day the merger was completed. Some two weeks later shares dipped to $67.73 before a recovery last month. Monday, the stock rose $2.18, or 2.9 percent, to $77.08 in afternoon trading on the New York Stock Exchange.

Horsch commented in a statement to investors that Molson Coors secured a strong competitive position in two high-margin beer markets - Canada and Britain. He believes the company has the potential to double the profitability of its U.S. business through a number of steps, including cost savings and merger synergies.

Adolph Coors Co. and Canada's Molson Inc., both family-run breweries, combined in a $3.4 billion deal with the aim of staying in the race for new international markets. Molson Coors is now the world's fifth-largest brewer with such brands as Molson Canadian, Coors Light, and Keystone.



30 March, 2005