Zacks Analyst Interview Highlights: Colgate Palmolive, Procter & Gamble, Estee Lauder, Anheuser Busch and Molson Coors

CHICAGO--(BUSINESS WIRE)--Zacks.com releases the latest Analyst Interview. Today’s interview is with senior analyst Steven Ralston, who talks about Colgate Palmolive (NYSE: CL), Procter & Gamble (NYSE: PG), Estee Lauder (NYSE: EL), Anheuser-Busch (NYSE: BUD) and Molson Coors (NYSE: TAP).

A synopsis of today’s Analyst Interview is presented below. The full article can be read at http://at.zacks.com/?id=2678.

Which particular companies in your coverage do you expect may perform best, looking ahead?

Generally speaking, food companies generate earnings growth at a mid-to-high single-digit rate. Beverage companies, however, are structurally able to grow faster at the high single-digit to low double-digit rate. But, personal product companies can grow earnings a percentage point or two above beverage companies. The earnings of these personal product companies, like Colgate Palmolive (NYSE: CL), Procter & Gamble (NYSE: PG), and Estee Lauder (NYSE: EL), have the potential to stand out during a recession. All three companies are rated Buy.

Where do you see some pitfalls with investing in this general sector?

Over the last two years, I have been a table-pounding buyer of Anheuser-Busch (NYSE: BUD) under $50. With a friendly offer of $70 per share from InBev on July 14^th, I finally downgraded the rating to a Sell. However, more is brewing in the beer industry: a structural change is about to occur. With the merger, excess costs will be wrung out of Anheuser-Busch by InBev.

In addition, a joint venture between Molson Coors (NYSE: TAP) and SABMiller should produce a more competitive brewer with greater scale, resources, and distribution synergies from the optimization of production and distribution networks. Therefore, the cost rationalization at Anheuser-Busch (instigated by the merger with InBev) and the joint venture between Molson Coors and SABMiller are expected to spark more intense competition, resulting in the loss of the positive pricing trends enjoyed by the industry for the last two years, in other words, a beer war.

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