J.P. Morgan GEMS FTM 12 May 26 AP Memory Technology Corp; Xiaomi (1810); Braskem; Becle, S.A.B. de C.V.; Offshore investors in town, what’s the feedback? and More

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J.P. Morgan GEMS FTM 12 May 26 AP Memory Technology Corp; Xiaomi (1810); Braskem; Becle, S.A.B. de C.V.; Offshore investors in town, what’s the feedback? and More

fend or gain share, while Cuervo’s vertical integration limits its ability to benefit from cheap

third-party agave spot prices. In response, we are cutting EBITDA estimates by ~15% on average for FY26–FY28, resulting in

forecasts ~17% below Bloomberg consensus, which should be adjusted following the 1Q26 miss. Despite the stock trading at

all-time lows, we view ~13x P/E as broadly fair given downside risks to consensus and sustained competitive intensity in U.S.

tequila. Our DCF-based Ps16 Dec-26 price target implies ~12% upside and corresponds to a 12.5x implied P/E. Cuervo’s

outlook remains highly dependent on the long-term gross margin outcome: our base case assumes gross margins stabilize

~3pp below pre-pandemic levels, but if the current deterioration is more cyclical and margins revert to pre-pandemic levels, our

price target would be ~25% higher, and ~40% if long-term gross margin ultimately settles ~1pp above pre-pandemic.

Offshore investors in town, what’s the feedback? (Inga Q Galeni/Baron Nkomo/Shaun Chauke)

Reforms on track, Financials constructive, Retailers talk diesel & consumer pressures. Politics has

come back to the fore.

Last week, our South Africa Research team hosted a series of meetings with international investors, bringing together

21 companies and industry experts. The discussions centered on the retail and financial sectors, alongside expert

perspectives on government reform initiatives and consumer trends. We left these meetings with greater confidence in our

positive view on South African domestic companies — the government’s reform agenda remains broadly on track, though we