EquityResearch6January2020FOCUSBarclaysCapitalInc.and/oroneofitsaffiliatesdoesandseekstodobusinesswithcompaniescoveredinitsresearchreports.Asaresult,investorsshouldbeawarethatthefirmmayhaveaconflictofinterestthatcouldaffecttheobjectivityofthisreport.Investorsshouldconsiderthisreportasonlyasinglefactorinmakingtheirinvestmentdecision.ThisresearchreporthasbeenpreparedinwholeorinpartbyequityresearchanalystsbasedoutsidetheUSwhoarenotregistered/qualifiedasresearchanalystswithFINRA.PLEASESEEANALYSTCERTIFICATION(S)ANDIMPORTANTDISCLOSURESBEGINNINGONPAGE44.Restricted-InternalGlobalConsumerStaples20for2020Notanotheryear-aheaddocument:RatherthanstarttheyearwithadryStaplesoutlookreport,wethoughtitwouldbemoreinstructivetotaskeachoftheBarclaysGlobalStaplesanalystswithwritingapithytwo-pagerontheirhighestconvictionideasforthecurrentyear.Theideacouldbeastock,atheme,apossiblepieceofM&A,managementchangeoranythingStaples-relatedwhichcouldshapethe2020debate.Morethan35ideasweresubmitted,butwerecondenseddowntothe20mostactionable.Convictionideas:Ofthe20thatmadethecut,sixweresingle-stockideas,withtwoeachfromBeverages,FoodandUSStaples.InBeverages,LaurenceWhyattarguesthatthereisanattractiveHeinekenmarginstorywithconsensustoolow(Heineken:FY20:theyearofmarginexpansion,6Jan2020),andalsoPernodwherehebelievesthatthereisagoodchancethatitwillupgradeguidanceattheH1stage.InUSStaples,LaurenLiebermanarguesthatP&G’srenaissanceisjustatthebeginningandCoca-ColacouldbecomethenextP&G.WarrenAckermanlooksatABFoods,believingitismisunderstoodandthatitcouldseefurthergainsin2020.HealsolooksatNestle’stop-lineperformancegapsandwhatneedstohappentogetto5%OSGlongterm.Managementchange:Unilever,Reckitt,KraftHeinzandHenkelallappointednewCEOsin2019.Threeofthe20ideasrelatetothistheme.HPCanalystIainSimpsonarguesthatRBwillretainitsHyHodivisionfornow,andthatdespiteanewCEOatHenkelitstillremainsthefavouritetoacquiretheCotyProfessionalassets.USfoodanalystAndrewLazarmakesthecasethatthenewKraftHeinzCEOhassignificantcost-savingfu...
