Analyst Note| Philip Gorham, CFA, FRM |
Pernod Ricard continued its momentum from the second half of the last fiscal year into the first quarter of fiscal 2022, with strong revenue growth that puts the company on track to meet our full year expectations. We are reiterating our wide moat rating and EUR 160 fair value estimate. We think a lot of the ongoing strong performance is priced into the stock, but we acknowledge that while consumers have cash in their pocket, volume growth and favourable mix could continue to drive this impressive revenue growth for several quarters to come. Although no margin data was released this quarter, we believe Pernod's 60% gross margins and strong price/mix make it one of the companies that should best be able to offset the current inflationary pressures.