Here’s Why Harding Loevner Exited its Position in Ambev S.A. (ABEV)

Harding Loevner, an asset management company, released its “Emerging Markets Equity” second quarter investor letter. A copy of the same can be downloaded here. In the second quarter, the fund returned -11.62% net of fees compared to -11.34% for the MSCI Emerging Markets Index. A broad global sell-off impacted the fund’s performance in the quarter. In addition, please check the fund’s top five holdings to know its best picks in 2022

Harding Loevner discussed stocks like Ambev S.A. (NYSE:ABEV) in the second quarter investor letter. Headquartered in São Paulo, Brazil, Ambev S.A. (NYSE:ABEV) is a Brazilian brewing company that engages in the production, distribution, and sales of beer, nonalcoholic drinks, and soft drinks. On September 23, 2022, Ambev S.A. (NYSE:ABEV) stock closed at $2.8800 per share. One-month return of Ambev S.A. (NYSE:ABEV) was -4.95% and its shares lost -1.37% of their value over the last 52 weeks. Ambev S.A. (NYSE:ABEV) has a market capitalization of $47.681 billion.

Here is what Harding Loevner specifically said about Ambev S.A. (NYSE:ABEV) in its Q2 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.”

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Ambev S.A. (NYSE:ABEV) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 18 hedge fund portfolios held Ambev S.A. (NYSE:ABEV)  at the end of the second quarter which was 18 in the previous quarter.

We discussed Ambev S.A. (NYSE:ABEV) in another article and shared First Eagle Investments’ views on the company. In addition, please check out our hedge fund investor letters Q2 2022 page for more investor letters from hedge funds and other leading investors.

Disclosure: None. This article is originally published at Insider Monkey.