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Anheuser-Busch stock lackluster, analysts say.

In a recent article in the Wall Street Journal, some analysts expressed pessimism about the future performance of Anheuser-Busch stock. The article pointed out that mutual funds sold 1.7 million more A-B shares than they bought in the first quarter, and that many brokerage firms give the firm a "hold" rating, which the article calls "a tepid term that on Wall Street is frequently a euphemism for 'sell'."

According to the article, investors have been scared off by declining Budweiser sales and the potential excise tax threat. The analysts said that the stock would fall further if the company decided to cut Budweiser prices significantly.

The article quoted several analysts expressing skepticism about the stock's future growth. "The top line |sales growth~ looks dead," Joseph Doyle, a Smith Barney analyst is quoted as saying. "Industry volume is basically flat and Anheuser-Busch does not seem to be gaining market share, which it usually had through the past 20 years."

Martin Romm, an analyst with First Boston, also expressed pessimism in the article. "The company is struggling," he said, noting that A-B market share is strong in parts of the country where the economy is especially sluggish.

Other analysts, however, pointed out that the decline in price for the stock could make it a very good buy.

"I think it's a good value," Wolodymyr Wronskyj, manager of the Dreyfus Fund was quoted as saying. "With patience, I think |investors~ will be rewarded."

Also on the positive side, the article noted that A-B is making "long-overdue" international moves (the recent joint-venture pacts with brewers in Japan, Mexico, Italy and China) and has recently finished work on its new Cartersville, GA, brewery, which could help the company fill orders more promptly.
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Publication:Modern Brewery Age
Date:Jul 19, 1993
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