Carlsberg Earnings: Profitability Improvement in a Challenging 2024

We maintain our DKK 970/$28 fair value estimate for no-moat Carlsberg after the firm reported 2024 results in line with our expectations. As with peers, a challenging consumer environment in key markets led to lower-than-expected volume growth. Despite headwinds throughout 2024, Carlsberg reached the top end of its full-year profitability guidance with 6% organic operating profit growth, largely driven by efficiencies. Due to near-term uncertainty, management provided broad 2025 guidance of 1%-5% organic operating profit growth. Nevertheless, the firm is confident that it can meet its long-term targets. The stock was up 6% following the announcement, and we continue to view it as undervalued. Still, we prefer our wide-moat companies in the brewing industry that have stronger market positions.