Shares of Ambev S.A. (ABEV) advanced in both São Paulo and New York trading on Wednesday, extending gains from a robust first-quarter earnings report that beat analyst expectations. The stock closed at R$16.27 on the Bovespa, up from Tuesday's close of R$15.81, while its American Depositary Receipt (ADR) traded at $3.225 in New York. The broader Bovespa index stood at 177,968 points.
The rally comes as investors digest the company's May 5 earnings release, which showed first-quarter net profit of R$3.89 billion, a 2.1% increase year-over-year. Net revenue reached R$22.46 billion, with organic net revenue—adjusted for currency and structural changes—rising 8.1%. Overall volume was nearly flat, but Brazil Beer volumes edged up 1.2%, driven by strong performance from premium and super-premium brands such as Stella Artois, Corona, and Original, which saw low-twenties percentage volume growth. No-alcohol beer volumes also grew in the low teens, led by Corona Cero and Skol Zero Zero. The company's BEES marketplace gross merchandise value doubled in Brazil Beer.
Ambev CEO Carlos Lisboa described the quarter as "a solid start to 2026," highlighting better beer volumes, double-digit normalized EBITDA growth, and expanded margins. Operating cash flow came in at approximately R$3.16 billion. The board approved a fresh R$700 million interest-on-capital payout, a local shareholder payment, and maintained July 6 as the payment date for a previously approved R$1.2 billion tranche.
In a separate filing on May 19, Ambev announced that Fernando Maffessoni, currently vice president of logistics for the Middle Americas Zone at Anheuser-Busch InBev, will become Ambev's vice president of logistics effective August 1, through December 31, 2027. He replaces Paulo André Zagman. The management change is seen as routine and did not dampen investor sentiment.
Analysts are increasingly optimistic about Ambev's near-term prospects, particularly with the upcoming World Cup expected to boost beer demand. Bernstein SocGen raised its price target on Ambev's ADR to $3.73 from $3.42, while maintaining a Market Perform rating. The note pointed to Heineken's first-quarter beer volumes in Brazil declining low single digits, contrasting with Ambev's volume growth, suggesting a competitive advantage.
However, the rally faces headwinds. Ambev's Brazil Beer cash cost per hectoliter surged 14.6% in the quarter, driven by commodity and foreign exchange pressures. The company maintained its outlook for Brazil Beer cash costs to increase 4.5% to 7.5% for the full year. Rising costs could pressure margins if price increases or a favorable product mix fail to offset them.
Macroeconomic risks also loom. Brazil's central bank activity index grew 1.3% in the first quarter but fell 0.7% in March, while services activity slid 0.8%. April inflation stood at 4.39%, with the benchmark interest rate at 14.50%. Suno Research economist Rafael Perez noted the economy "remained resilient" but said restrictive monetary policy was holding back growth.
Investors are currently treating Ambev as a short-term trade tied to event-driven demand rather than a long-term logistics play. The focus now shifts to whether actual World Cup consumption, coupled with premium beer and digital channel growth, can translate into volume gains that justify the recent price appreciation. Ambev remains the largest brewer by volume in Latin America, operating in 18 countries, with Anheuser-Busch InBev holding approximately 62% of its stock and controlling the company.