The Point for Latin America

Research evidence excerpt

The Point for Latin America

América Móvil (AMX.N) - AMX likely to favor M&A over buybacks; keep Neutral

AMX's low net-leverage supports its strategic focus on M&A as emphasized since

Investor Day. Execution of the buyback program, in this context, seems more likely

to remain at slow at the $0.5bn annualized level. While we agree with the M&A

thesis—which centers around market repair and consolidation trends—that it

could sustain and deepen the margin improvement and low capex intensity

improvements of recent years, we tend to think the market would react with

caution to acquisitions while investors may favor a higher distribution via

buybacks or dividends.

Andrés Cardona | Leandro Bastos, CFA

Bimbo (BIMBOA.MX) - 2Q26 Review & CC Highlights: Quality Quarter, Higher

Guidance

The guidance upgrade is the key takeaway. While 2Q26 revenue and EBITDA were

broadly in line, the quality of the quarter was stronger than the headline numbers

suggest. Despite meaningful FX headwinds, particularly in North America, and

higher expected commodity inflation (US$70–90m, or 35–45bps, vs. ~20bps

previously), management raised FY26E EBITDA margin guidance to 14.7–15.2%

(from 14.6–15.1%) while maintaining its constant currency revenue outlook. We

view this positively, particularly in a quarter when several consumer companies

delivered in line results but lowered guidance. The upgrade reinforces our view that

productivity initiatives, the North America transformation and commercial

execution are running ahead of plan. Lower CapEx guidance (US$1.0–1.2bn) should

further support cash generation and deleveraging from 2.5x Net Debt/EBITDA.

Overall, Bimbo stood out positively this earnings season by raising its guidance

despite a challenging, inflationary macro environment.