Business
FEMSA (FMX) Rises 20% in Six Months: Will the Rally Continue?
FEMSA (FMX) Rises 20% in Six Months: Will the Rally Continue?
About this update from Coca-cola Femsa Sab De Cv Units Cons Of 5 Shs -l- + 3 Shs Series -b-
Fomento Economico Mexicano S.A.B. de C.V. FMX, alias FEMSA, has been reaping the benefits of its diversified business, continued strength in OXXO Mexico as well as OXXO Gas, expansion into newer businesses and digital initiatives. Gains of these positives have been well reflected in its stock performance.The company has been on track with its strategy of creating a distribution platform in the United States through the expansion of its footprint in the specialized distribution industry. The company is also poised for growth through investments in digital and technology-driven initiatives. Moreover, FEMSA displays strong financial flexibility.Shares of this Zacks Rank #3 (Hold) company have rallied 28.3% in the past six months compared with the industry’s growth of 4.4% and the S&P 500’s 11.9% rise. The FMX stock also compared favorably against the sector’s decline of 3.4%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Factors Positioning FEMSA for GrowthFEMSA has been on track with its expansion in the specialized distribution industry. This expansion relates to its plan of investing in adjacent businesses to leverage capabilities across different markets, providing an opportunity for attractive growth and risk-adjusted returns.With the presence of its OXXO business and other retail operations, the company has become an expert in the organization and management of supply chains and distribution systems. FEMSA serves several businesses and retail customers through millions of interactions in different industries.FEMSA stands to benefit from its wide exposure to industries like beverage, beer and retail. This gives the company an edge over its competitors. The company participates in the beverage industry through its subsidiary Coca-Cola FEMSA KOF, one of the largest franchise bottlers for Coca-Cola KO products.In the beer industry, FMX enjoys a notable position with its 14.76% stake in Heineken, a leading brewer with operations in 70 countries. The company operates in the retail space through the FEMSA Comercio subsidiary.Coca-Cola FEMSA is the flagship segment engaged in the production and distribution of carbonated beverages. The division is the largest Coca-Cola bottler in Latin America and the second-largest Coca-Cola bottler globally in terms of sales volumes.Coca-Cola is on track with its strategy of becoming a total...