Modest Changes For AmBev, Morgan Stanley Reports

In a report released this morning, Morgan Stanley said that it is Equal-weight on AmBev's (NYSE: ABV) shares, “though they remain our preferred way to participate in LatAm Beer.”

“We are making modest changes to our operating assumptions and are revising our net income up 6% in 2010 and 2.2% in 2012 to reflect higher interest income resulting from stronger than anticipated cash flow generation (as well as a lower tax rate in 2010e),” Morgan Stanley writes. “We expect AmBev to deleverage significantly by year-end, finishing the year with net cash of ~US$400 million.”

AmBev closed Friday at $143.52.