Soccer-France, retail, beverage stocks: Brazil brokerage picks World Cup favourites

By Gabriel Araujo

SAO PAULO, June 3 (Reuters) – France may be leading one race for the World Cup trophy, but in the markets’ version of the global showpiece tournament, retail and beverage stocks are also shaping up as favourites.

A thematic note by Brazilian brokerage XP combined a probabilistic model of the competition with an investor playbook for the event, highlighting how both soccer giants and consumer names could come out on top.

XP’s model, based on 10,000 simulations and more than 3,300 international matches, gave France a 9% chance of lifting the trophy in July, ahead of Spain (6.4%) and defending champions Argentina (6.1%). Brazil ranked fourth, with 6%.

Not everyone on Wall Street agrees.

A rival model from Goldman Sachs last week put Spain firmly in the lead, with a much higher 26% probability of winning, followed by France, Argentina and Brazil, underscoring how even data-driven forecasts can diverge when it comes to soccer.

While analysts debate who will lift the trophy, investment bets also emerge. XP expects the expanded 48-team tournament in the United States, Canada and Mexico to generate tailwinds for tourism, transport, themed consumption and streaming globally.

In Brazil, the brokerage sees more targeted opportunities: retail – apparel, electronics and food – alongside beverages.

Grupo SBF, the distributor of Brazil kit sponsor Nike in the country, is seen as the most direct bet on World Cup fever, while brewer Ambev stands out in food and drinks, the analysts said.

Companies are gearing up for the demand spike.

Food processor MBRF said sales tied to World Cup gatherings could jump by as much as 50% compared with the previous tournament held in Qatar in late 2022, helped by promotions and a longer competition calendar.

Executives also pointed to a favourable match schedule, with Brazil playing on a weekend and a Friday in the group stage, likely boosting gatherings for barbecues and snack sales. They hope the record five-times reach the quarter-finals at least.

The World Cup is likely to sit alongside MBRF’s strongest seasonal sales periods this year, which also include year-end festivities and Mother’s Day, the firm’s marketing vice president Manoel Martins said.

(Reporting by Gabriel Araujo; Additional reporting by Roberto Samora, editing by Ed Osmond)