Brown-Forman Corporation (BF-B)
Shawndele Lutchman, Jennifer Roman, Lynn Keating

About the Company
 The Brown-Forman Corporation is one of the largest American-owned
companies in the spirits and wine business. It operates within the
distilled beverage and wine industry.
 Brown-Forman Corporation engages in the manufacturing, bottling,
importing, exporting, marketing, and selling alcoholic beverages. It
provides Whiskey, Ready-to-drink products, Vodka, Tequilas,
Champagnes, Wines, Liqueurs, and other distilled spirits.
 Some well-known brands of the corporation include Jack Daniel’s,
Southern Comfort, Finlandia Vodka, Tuaca, Woodford Reserve Bourbon,
Canadian Mist, Early Times, Old Forester, Korbel Champagne, Herradura,
and Chambord.
About the Company
 Brown-Forman stock is traded on the New York Stock Exchange.
As of 2011, the company employs 3,900 people.
 The company is headquartered in Louisville, Kentucky, and Paul
C. Varga currently serves as both Chairman and CEO.
 The company was awarded by Newsweek as 63rd out of 500 of
the largest corporations with a strong environmental track
record. It was also ranked 3rd in its industry (2009).
Facts and History

Brown-Forman Corporation was founded in 1870 by
George Garvin Brown.

The company is currently one of the largest Americanowned companies in the alcoholic beverage industry.

The company earned a record-setting $100 million in
net sales in 1960, and a record growth of $1.9 billion
in 1998.

Brown Forman’s main competitors include Diageo and
Beam.

Currently, its annual revenue is $2,849 million, and the
company is constantly trying to enforce its
commitment to innovation within its distilleries, as
well as within the alcoholic beverage manufacturing
industry.
Financial Data
Financial Data
X Variable
25.00% 1 Line Fit Plot

In this case, since the P-Value is
greater than 0.05, the alpha is
not different from 0, meaning
that the stock is fairly priced.

The slope of the regression is
0.631. Regarding the risk of our
stock, if the market increases by
1%, then the stock (beta)
increases by 0.631%.
20.00%
15.00%
Y
10.00%
5.00%
0.00%
-15.00% -10.00% -5.00% 0.00%
-5.00%
Y
5.00% 10.00% 15.00%
-10.00%
-15.00%
X Variable 1
Financial Data
 Determination of Cost of Capital using CAPM model, assuming a
risk-free rate of 3% and market risk premium of 7.5%:
E(Ri) = rf + ßI (Rm – rf)
E(Ri) = 0.03 + 0.631(0.075)
E(Ri) = 7.73%
Dividends
Investor Perspective