Altria Sells Part of Anheuser-Busch InBev Stake, Raises Financial Outlook for 2024

Altria Group, known for its tobacco products, has made a strategic financial move by selling a significant portion of its shares in Anheuser-Busch InBev, the world's largest brewer. The sale involved 35 million shares, reducing Altria's stake from approximately 10% to about 8.1%, with the potential to decrease further to 7.8% if underwriters exercise an option to buy additional shares. This transaction is part of Altria's broader plan to reallocate capital and enhance shareholder value, with the proceeds aimed at funding its own stock repurchase program. The sale, valued at around $2.26 billion based on Anheuser-Busch Inbev's closing price prior to the announcement, has caused a temporary dip in the brewer's stock. However, analysts, including those from RBC Capital Markets, suggest that the impact on Anheuser-Busch Inbev's stock is of 'minimal longer-term significance.'

The timing of Altria's decision coincides with its announcement of an increased share repurchase program, from $1 billion to $3.4 billion for fiscal year 2024, and an improved earnings forecast for the same period. The revised guidance anticipates a profit of $5.05 to $5.17 per share, up from the previous forecast. Altria's CEO, Billy Gifford, emphasized the company's confidence in its future and the perceived undervaluation of its shares. The strategic divestiture and concurrent share buyback reflect a focused approach to capital allocation and a commitment to delivering value to shareholders.

Looking ahead, the market speculates on the possibility of Altria further reducing its stake in Anheuser-Busch Inbev. Such a move could pave the way for more share buybacks, savings on future dividends, and potentially significant mergers and acquisitions. Anheuser-Busch Inbev, with its portfolio of leading beer brands such as Budweiser, Stella Artois, and Corona, remains a formidable entity in the beverage industry. Despite the current stock pressure, its diverse brand offerings and global presence suggest resilience and the potential for continued growth in the long term.