5 Best Penny Stocks To Buy Now

4. Ambev SA (NYSE:ABEV)

Share Price as of October 21: $2.94

Number of Hedge Fund Holders: 18

Ambev SA (NYSE:ABEV) is a leading global beverage company with a strong portfolio of well-known brands. The company has a strong history of growth and a track record for profitability. The company’s diversified business model which includes a wide range of products and geographical markets justifies its inclusion among the best penny stocks to buy now. Ambev SA (NYSE:ABEV) has a trailing twelve-month operating margin of 22.71% and an ROE of 16.76%. Moreover, the company has free cash flows of $13.59 billion.

On July 13, JPMorgan analyst Lucas Ferreira upgraded Ambev SA (NYSE:ABEV) to Overweight from Neutral and raised his price target on the shares to R$17 from R$15.

At the close of Q2 2022, 17 hedge funds were bullish on Ambev SA (NYSE:ABEV) and held stakes worth $185.73 million in the company. Of those, First Eagle Investment Management was the largest shareholder in the company.

Here is what Harding Loevner had to say about Ambev S.A. (NYSE:ABEV) in its second-quarter 2022 investor letter:

“This quarter, individual stock selection decisions led to a reduction in our overweight to Consumer Staples. We sold Ambev S.A. (NYSE:ABEV), Brazil’s dominant brewer with strong franchises across South and Central America, which we owned since 2003. Its profit margins have declined in recent years, and management’s strategy to restore them is to entice Brazilians (whose beer consumption is already high) to trade up to premium brands. Despite our high regard for Ambev’s management, we think this strategy will be unsuccessful so long as the Brazilian consumer is under financial pressure from inflation and high unemployment. Ambev is still a high-quality, growing company, but we think there are more appealing opportunities in Brazil and beyond.”