This Bill Gates Stock Just Hit a New 52-Week High and 1 Signal Says There’s More Room to Run

Femsa (FMX) was one of the 169 stocks and ETFs hitting new 52-week highs on Tuesday. It is one of Bill Gates's oldest investments.

Bill Gates’ investment vehicle, Cascade Investment LLC, owned 27.89 million ADS (American Depositary Shares) as of March 31. That represents 8.2% of the Mexican holding company’s total equity. Cascade’s stake in Femsa accounts for 10.71% of its total investments. 

Cascade made its first investment in Femsa in December 2007, buying 10.8 million ADS for $390 million. Those shares are worth $1.53 billion today. Its total holdings in Femsa are worth nearly $4 billion at yesterday’s 52-week high.  

Between June 26, 2008, and July 31, 2008, Cascade acquired 8.57 million ADS of Coca-Cola Femsa (KOF) at prices ranging from $54 to $59. Femsa owns 47.2% of Coca-Cola Femsa’s equity and controls 56% of the voting shares.   

Femsa’s new 52-week high of $141.47 yesterday was the 38th of the past 12 months. FMX stock is up 26.4% in 2026 and 38.5% over the past year. 

Despite the gains, I see the share price rising over the next 12 months and beyond. Here’s why.  

The Holding Company Discount

As I mentioned in the introduction, Femsa owns 47.2% of Coca-Cola Femsa, a leading Coca-Cola (KO) bottler, with operations in nine Latin American countries, including Mexico, where it has 27 of its 55 bottling plants. In 2025, Mexico and Central America accounted for 58% of Femsa’s revenue, with South America accounting for the remaining 42%.

Based on Coca-Cola Femsa’s market cap of $22.84 billion, Femsa’s ownership stake is worth $10.78 billion. Femsa’s current market cap is $25.74 billion, so that means the rest of Femsa’s businesses are worth slightly less than $15 billion. 

What else does Femsa own? 

It has four operating units: 1) OXXO Mexico, which operates 24,708 convenience stores in the country; 2) Americas & Mobility, which includes all OXXO convenience store operations outside of Mexico (Brazil, Colombia, Chile, Peru and the U.S.), as well as its OXXO gas stations in Mexico and the U.S; 3) Approximately 2,749 convenience stores under several banners in Europe; and 4) 4,584 drugstores under several banners in Mexico, Chile, Colombia, and Ecuador. 

In Q2 2026, these four operating units had combined revenue of 154.68 billion Mexican pesos ($8.83 billion), accounting for 67% of Femsa's overall revenue, with the remaining 33% attributable to Coca-Cola Femsa.

So, based on Coca-Cola Femsa’s trailing 12-month revenue of 296.8 billion Mexican pesos ($16.94 billion), its market cap is 1.35 times sales. Meanwhile, Femsa’s P/S ratio based on its trailing 12-month revenue of 873.44 billion pesos ($49.81 billion) is 0.52x, or 0.46x excluding Coca-Cola Femsa. Coca-Cola, which owns 27.8% of Coca-Cola Femsa, has a P/S ratio of 7.6x.

Coca-Cola has such a high multiple because of its profitability and margins. Bottlers should have a lower P/S multiple because their margins are much lower. However, Femsa’s P/S multiple, excluding Coca-Cola Femsa’s revenue, is just one-third as high as Coca-Cola Femsa’s. 

That’s the holding company discount.

Over the past five years, KOF stock has outperformed FMX by more than double. However, in the past year, FMX has begun to outperform KOF. I expect this to continue as investors realize they can gain exposure to KOF at a lower cost.  

Source: Google Finance

The Sum of Femsa’s Parts

As mentioned in the previous section, Coca-Cola Femsa’s market cap is $22.84 billion, while Femsa’s is $25.74 billion, with the non-Coca-Cola Femsa holdings worth $14.96 billion.

OXXO Mexico accounts for approximately 56% of Femsa’s non-Coca-Cola Femsa trailing 12-month revenue of 576.64 billion Mexican pesos ($32.91 billion). That’s followed by Americas & Mobility (18%), Drugstores (14%), Europe (9%), and Other Businesses (3%). 

The largest publicly traded convenience store operator in North America is Alimentation Couche-Tard (ANCTF), which owns Circle K. It has a P/S ratio of 0.81x. Another large operator is Casey’s General Stores (CASY). Its P/S multiple is over double at 1.82x. 

Based on an approximate trailing 12-month revenue of $24.35 billion for its OXXO Mexico and Americas & Mobility units and a P/S ratio of 0.81x, the value of these two units would be $19.72 billion. At a multiple of 1.81x, it would be $44.07 billion, substantially more than the $14.96 billion based on its current market cap less the 47.2% stake in Coca-Cola Femsa.

That doesn’t even take into account its drugstores, European convenience stores, and other businesses such as the fees generated by Spin by OXXO, the company’s digital app for transferring funds, paying bills, and withdrawing cash.

However, most of the revenue from its Americas & Mobility operating unit is for gasoline sales, which have very low margins. In the first six months of 2026, the unit’s operating margin was 0.7%, while OXXO Mexico’s operating margin was a healthy 8.9%. Clearly, OXXO Mexico carries more of the value. 

Thus, even if the two units were valued at $15 billion, not $19,72 billion, the remaining parts of the business after accounting for its Coca-Cola Femsa stake could be had for free. 

According to S&P Global Market Intelligence, the 13 analysts that cover FMX in Mexico rate it Outperform (1.77 out of 5). If its second-quarter results are any indication, the best is yet to come for Femsa in 2026. 

It’s a long-term buy.