FEMSA's (NYSE:FMX) third quarter wasn't flawless, but it was a good quarter that showed ongoing progress in most of the initiatives that matter most to management and to the creation of shareholder value. While the "will they/won't they?" with the Heineken stake is likely to drag on, there are a lot of irons in the fire with Coca-Coca FEMSA (NYSE:KOF) and plenty of growth opportunities for the retail operation.
I haven't made too many meaningful changes to my model, and most of the change in my fair value calculation come from changes in the value of the Heineken stake (which I value at current prices) and exchange rates. With a fair value of $103 and a runway to several years of above-average growth, I believe FEMSA is worth considering as a buy candidate, particularly on the frequent pullbacks that seem to come with these shares.
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FEMSA Comes Through Again