Heineken N.V. is taking a knock as HSBC downgrades its rating from Buy to Hold, citing concerns about the duration of the beer volume recovery.

Analyst Carlos Laboy voices the intricacies of the overall beer picture, attributing the slump to potent price hikes worldwide, stifling consumer capacity for beer and other beverages up until 2025 in crucial markets like Europe, Mexico, and Brazil. However, Laboy is more specific as he zeroes in on Heineken’s leadership team.

“Management has broadened its EBIT guidance to a vast range of low-single-digits to high single-digits. This wide range is unproductive and sparks the question of why, after over three years into the EverGreen strategy, it is unable to furnish a more defined outlook for 2024.”

Laboy criticizes Heineken’s executive suite for casting doubt on their grasp of planning and budgeting, despite the company’s resolute brand reputation.

Looking ahead, HSBC projects a 6.9% organic revenue growth for Heineken in 2024, accompanied by 4.7% EBIT growth and a 1% EPS growth.

Heineken’s shares have plunged over 5% in European trading this week following the beer giant’s disheartening profit forecast, casting a shadow over its investment appeal.