Molson Coors faces risks from fluctuating foreign currency exchange rates, impacting cash and sales. Cost inflation, industry softness, and lower contract brewing volumes pose threats to sales and profitability. Potential impairment losses exist for goodwill and indefinite-lived intangible assets, contingent on unfavorable market changes. Litigation and other disputes, including the Stone Brewing lawsuit, carry uncertain costs. Debt covenants and leverage ratios require ongoing compliance.
Financial Upside
Molson Coors has positive operating cash flows and access to external capital. The company's strategy to expand beyond beer, including acquisitions like Blue Run Spirits, and premiumization efforts, offer potential growth opportunities. Favorable price and sales mix, and cost savings initiatives, could boost profitability. The company's share repurchase program provides a potential avenue for shareholder value creation.
