Heineken
🇳🇱 HEIA.AS · Amsterdam · NL0000009165
Consumer
EUR 66.12 price at analysis
Scores
Key Metrics
Powered by EODHDP/E (TTM)
19.5
P/E (Price-to-Earnings)Shows how much investors pay for each $1 of profit. We display the TTM P/E (Trailing Twelve Months) which uses actual earnings from the last 4 quarters. This is more reliable than Forward P/E which uses analyst estimates.
Calculation: 66.12 ÷ 3.38 = 19.5
TTM period through: 2025-12-31
Forward P/E (estimated): 12.7
Based on analyst estimates
Reference: Provider P/E (Trailing): 19.7
Yield (Fwd)
2.87%
Dividend YieldThe Forward yield (Fwd) shows the next announced annual dividend / current price — what you'd earn going forward. The Trailing yield (TTM) in the tooltip shows dividends actually paid in the last 12 months. Forward is shown as primary because it reflects the company's current commitment to shareholders.
Trailing Yield (TTM): 2.90%
Div. Growth (5Y CAGR)
10.2%
Growth Streak
1 yrs
Consecutive years of increase
Net Debt/EBITDA (TTM)
2.5x
Latest quarter: 5.0x
Net Debt / EBITDAA leverage ratio showing how many years of EBITDA (earnings before interest, taxes, depreciation, and amortization) it would take to repay net debt. EBITDA approximates operating cash generation. Lower ratios (e.g., <3x) are generally safer; higher (e.g., >5x) may indicate more financial risk.
TTM through: 2025-12-31
Latest quarter (2025-12-31): 5.0x
The quarterly value can spike when quarterly EBITDA is very low (e.g., one-time charges).
Quick guide: <2x manageable, >4x can be risky (sector-dependent).
Payout (Fwd)
56.1%
Payout RatioDividends as a percentage of earnings. The Forward payout (Fwd) uses the announced dividend divided by actual past earnings (TTM) — it tells you if the company can afford what it promised. Very high payouts can be risky, especially if profits fall.
Announced dividend / actual earnings (TTM)
Payout (TTM): 67.7%
Cash Flow Payout (TTM): 25.5%
FCF Coverage (TTM): 2.05x
ROE
9.9%
ROE (Return on Equity)A profitability measure: how much profit is generated from shareholders’ equity. Higher isn’t always better if it comes from high debt.
EV/EBITDA
8.2x
EV/EBITDAA valuation ratio that compares total business value (including debt) to EBITDA. Lower can mean cheaper, but context matters.
Summary
Heineken is a leading global brewer with a strong brand portfolio and wide geographic footprint. However, a combination of declining earnings, a recent dividend cut, and significant structural risks including massive tax liabilities and water scarcity constraints make it unsuitable for new positions. The risks and elevated valuation multiples outweigh the current 2.90% yield, and better opportunities exist in more stable essential service businesses.
Sector Context
Heineken operates globally in the consumer staples sector, specifically focusing on the brewing and distribution of beer and cider. While beverage companies traditionally offer defensive, predictable cash flows ideal for dividend strategies, global brewers are highly sensitive to emerging market currency fluctuations, regional excise tax hikes, and increasingly stringent environmental regulations regarding water extraction and packaging waste.
Temporary Opportunity Identified
An €874 million non-cash impairment charge regarding its investment in China Resources Beer caused a headline net loss in H1 2024, compounded by poor European weather and the timing of Easter.
📊 Strategy Analysis
- • Underlying business performance remains positive, with H1 2024 organic operating profit growing 12.5% despite headline impairment losses
- • Excellent free cash flow generation, with a very conservative Cash Flow Payout ratio of 25.46% easily covering distributions
- • Debt levels remain well-managed within strategy thresholds at a Net Debt/EBITDA of 2.51x
⚠ What to Watch
- • Valuation is elevated with a TTM P/E of 19.54, which is expensive given the 5-year EPS CAGR decline of -10.1%
- • Recent 2024 dividend cut of 9.7% driven by emerging market currency devaluations and rising financing costs, indicating fundamental headwinds
- • Massive structural liabilities including €1.378 billion in unresolved Latin American tax disputes and up to €478 million provisioned for Greek antitrust litigation
- • Current dividend yield of 2.90% falls below the strategy's 3% minimum threshold
- • Severe regulatory headwinds in core markets, including excise tax hikes (e.g., Vietnam) and structural risks to water extraction permits affecting 44% of consumption
📊 Historical Trends (10 Years)
Powered by EODHDThese charts show how key metrics have evolved over the past decade, helping you identify if the company is improving or deteriorating.
Debt Evolution (Net Debt / EBITDA)
Lower values are better. A declining trend indicates the company is reducing its debt (deleveraging).
Revenue & Earnings Growth
Consistent growth in revenueRevenue
The money a company brings in from selling its products or services. It’s the top line before costs. (blue) and earningsEarnings (Profit)
What’s left after expenses. Positive earnings mean the business made a profit; negative means a loss. (green) indicates a healthy business. Look for upward trends and recoveries after temporary dips.
Dividend Sustainability (FCF vs Dividends Paid)
Free cash flowFree Cash Flow
Cash left after the company pays for running the business and maintaining it. Often used to fund dividends, pay debt, or buy back shares. (FCFFCF (Free Cash Flow)
Short for Free Cash Flow: cash left after operating needs and maintenance spending., blue) should cover dividends paidDividends Paid
Cash the company paid out to shareholders. It’s not guaranteed and can change over time. (green). If dividends consistently exceed FCFFCF (Free Cash Flow)
Short for Free Cash Flow: cash left after operating needs and maintenance spending., the dividend may be at risk.
Analysis date: 2026-06-06
Disclaimer: This information is for educational purposes only. Not financial advice.