Beer is one of humanity’s earliest alcoholic beverages. It has been an essential staple of the world’s economies for thousands of years. In general, steady consumer consumption and massive conglomerates characterise the beer stocks market.
Here, we’ve compiled a list of some of the top beer companies on the market, allowing investors to decide which one is the best fit for their needs.
What Are Beer Stocks, and Who Are the Leaders?
Beer stocks are shares of breweries that make beer. These companies produce the ingredients used by other brewers to create their beers. The largest brewery in the world is Anheuser-Busch, which owns beer brands like Budweiser and Stella Artois, among others.
This publication will explain investing in notable beer companies and outline some currently listed beer stocks.
Why Invest in Beer Stocks?
There are three main reasons why people invest in beer stocks.
First, many people take pleasure in drinking beer. If you do, too, owning beer shares could allow you to share in the profits generated by a company whose products you enjoy.
There are light lagers, dark lagers, ales, stouts, porters, wheat beers, etc. Each type of beer offers something unique to consumers. For example, some people prefer light lager while others enjoy darker brews. No matter what kind of beer you like best, there is probably a listed company producing it.
Second, the craft beer trend is growing, and small independent breweries are popping up worldwide. In addition, some listed corporations own many of these breweries. Nevertheless, we still consider them “craft” because they focus on quality rather than quantity.
Third, if you’re interested in the global market, exposure to international markets through beer stocks may be worth considering.
What Does it Take to Become a Successful Investor in Beer Stocks?
Being new to the beer industry can be overwhelming. For this reason, the first thing investors need when investing in any stock is to define goals. Identifying a clear target accomplishment can help choose suitable investments.
Secondly, investors in beer stocks must determine their risk tolerance. A higher risk tolerance implies taking more significant risks if they could lead to higher returns. On the other hand, a lower risk tolerance suggests safer bets offering lower returns and a steady income stream.
Learn about the Company and Develop an Investment Strategy
The next step is to start researching the company. Investors should start by learning about the industry the company operates in. For example, if you are interested in buying into the brewing industry, read up on the history, the current trends, and the future outlook. Also, learn about the company itself. The areas to focus on include profit reports, headquarter location, management team, years of operating, etc. These will help better understand the company and its chances of success.
In addition, when researching the company, it is essential to concentrate on financial statements. These are reports that detail the performance of the company over time. They include sales, earnings, cash flow, assets, liabilities, and equity. Ultimately, it is highly advisable to understand as much as possible about the company’s finances.
Now that investors have learned about the industry, they should settle on an investment strategy. The strategy could entail buying individual shares, putting together a mutual fund, or even creating an index fund. Once having determined the best approach, beer investors should stick with it. Otherwise, frequent method changes could lead to losses due to poor timing.
Analyse Earnings Prospects
Finally, one step before deciding is analysing the company’s earnings prospects. How much profit does the company expect to make? When will those profits be released? Will they meet expectations? These questions help determine whether or not the company is undervalued or overvalued. In other words, past earnings should guide predicting future earnings.
Make A Decision
At last, the crucial thing is to make the proper decision. After analysing all of the information, investors should conclude whether or not the company they are considering investing in is a good fit for them.
Even though the beer industry is not a high-growth industry, it has potential. What’s more, According to Statista, the beer industry will grow annually by 6.80% (CAGR 2022-2025).
The 10 Best Known Beer Stocks
Beer stocks have had relatively stable price levels in the long run. Below is the list of the companies leading the beer market:
A.B. InBev (NYSE: BUD)
Anheuser-Busch InBev SA/NV is a beer-brewing company with a headquarters in Leuven, Flanders, Belgium. It has been in business since 1864 and currently operates in more than 160 countries throughout Europe, Asia, Africa, Latin America, North America, and Australia. The company has invested heavily in developing local brands and is now looking to expand its distribution network through acquisitions.
A.B. InBev, the world’s largest beer producer, controls hundreds of beer brands, including Budweiser, Stella Artois, Beck’s, Corona Extra, and acquired craft brewers in the U.S.
A.B. InBev is a merger between U.S. brewer Anheuser- Busch and Belgium-Brazilian brewer Inbev in 2008 and the acquisition of South African brewery SABMiller in 2016.
The company has been listed on the New York Stock Exchange since 2007 and operates under three leading brands: Budweiser, Stella Artois, and Hoegaarden. It is one of the world’s largest brewers by volume, with a market cap of $119.94 billion.
Beer brewing relies on traditional manufacturing processes in many ways. But AB InBev is open to changing things. A.B. InBev is thinking a year or so ahead of its industry. They investigate how technology can improve the manufacturing process and optimise beer filtration.
The financial summary is here.
Company website: https://www.ab-inbev.com/
Boston Beer Company (NYSE: SAM)
The Boston Beer Company, also known as Samuel Adams Boston Brewery, is an American brewery founded in 1984 by Jim Koch. The company brews various beers, including the flagship Samuel Adams Boston Lager and Samuel Adams India Pale Ale, seasonal brews, Brewmaster, and the Barrel Room Collection. It also sells bottled water, wine, and cider. Its products are distributed in over 100 countries around the globe.
In 2010, BBC began distributing its products outside of the United States. Today it distributes its products in over 30 different countries around the globe.
Boston Beer Company has a market cap of $4.5 billion and a P/S ratio of 2.24.
Company website: http://www.bostonbeer.com/about-us
Ambev (NYSE: ABEV)
Ambev, a Brazilian brewer, is the largest beer company in Latin America. It results from the merger between two of the oldest breweries in Brazil. The company’s roots go back to 1884, but it was not until 1998 that the company became known as Ambev. Its headquarters are located in São Paulo, Brazil. Ambev is a subsidiary of Interbrew International.
The company has distribution rights in Brazil for Pepsi products and its global beer brands, including Skol and Brahma.
The company’s success can be attributed to its ability to innovate and adapt to changing market conditions.
ABEV is the least expensive stock on this list, with a price below $5 per share. However, the stock hit its highest price in 2013, and its performance has been somewhat choppy.
Company website: https://www.cbrands.com/
Constellation Brands, Inc. (NYSE: STZ)
Constellation Brands, Inc. is the third-largest beer producer in the U.S. behind Anheuser Busch and MillerCoors. It owns and operates the world’s most extensive portfolio of premium brands, including Corona Extra, Modelo Especial, Pacifico, Victoria, Woodbridge, and Svedka Vodka. Constellation Brands also owns the Ballantine brand, which produces some of the best-selling beers in the United States.
One of the most significant factors behind Constellation Brands’ impressive growth in recent years has been its focus on the premium market, which continues to thrive.
The total revenue of STZ for the quarter ended February 2022 is 2.10B USD. The rest of the financial results are on the link.
Constellation Brands is a beer stock to consider, whether for its beer, wine, spirits, or forthcoming cannabis-infused line of products.
Company website: https://www.cbrands.com/
Molson Coors Beverage Company (NYSE: TAP)
The Molson Coors Brewing Company is a Canadian multinational brewing and beverage company headquartered in Golden, Colorado. Adolphus Busch founded it in 1873. as the St. Louis Brewery. It has been growing ever since.
As the second-largest brewer by volume in the US, Molson Coors has strong relationships with distributors, retailers, and restaurants and strong consumer loyalty. It now produces a wide range of beers, including Coors Light, Carling, Blue moon, Crispin Cider, and Hop Valley.
The company brews more than 200 different types of beer, primarily in Canada, the U.S., Mexico, Europe, Australia, New Zealand, South Africa, and Asia.
Molson Coors is traded on the Toronto Stock Exchange and the New York Stock Exchange.
TAP reached its highest price point back in 2016, but it’s still rising over time. The last couple of years haven’t been particularly kind to TAP, but the global brands involved could offer potential growth in the future. The dividend yield is 2.73%.
Company website: https://www.molsoncoors.com/
DIAGEO (NYSE: DEO)
Diageo is an alcoholic beverage company that has been around for a long time. It was founded in the 17th century and now owns 20 of the world’s top 100 spirits brands. The headquarter is in London, the United Kingdom.
Diageo manufactures popular spirits and beer brands, including Johnnie Walker, Bailey’s, Captain Morgan, Smirkon, Crown Royal, Tanqueray, Guinness, Ketel One, etc.
Like its peers, Diageo’s strong growth is driven by its brand power and lower cost advantages. With twenty of the world’s leading one hundred global premium distilled spirits brands under its belt, the company enjoys strong customer loyalty. This reputation allows them to charge higher prices, increase their margins, and return more on their investments.
Moreover, the company’s sizeable global volume gives them more substantial pricing power with suppliers and more significant economies of scale in production, cutting costs and further improving their margins and economies of scale.
Brexit presents a unique risk for Diageo because it affects its operations in the U.K., where Diageo has a significant presence. Since it is headquartered and produces most of its products in Scotland, potential tariff increases with the E.U. could hurt Diaego’s competitiveness and profitability in one of its main markets.
Diageo pays dividends every six months and raises them regularly.
Company website: https://www.diageo.com/
Kirin Holdings (OTC: KNBWY)
The company was formerly called Kirin Brewery Company, Ltd., and then changed its name to Kirin Holdings, Ltd. in July 2007.
Kirin Holdings Company, Ltd. was established in 1885 and is located in Tokyo, Japan.
Kirin isn’t a fast-growing business, and sales have been flat for years. However, profitability is coming back after the COVID-19 pandemic and supports this beer stock.
It is a Japanese multinational beverage company, and it is Japan’s most extensive beer and soft drink maker by volume. Kirin Beverage Group also includes the Kirin Brewery Company (a brewery) and Kirin Foods Corporation (a food manufacturer).
The company also owns an Australian subsidiary, Lion Nathan Pty Limited, that manufactures alcoholic beverages.
In addition to brewing and distributing beer, wine, happo-shu, and spirits, Kirin Holdings also sells nonalcoholic drinks such as soft drinks, dairy products, fruit juices, carbonated water, and other products. It also produces and sells biochemical and pharmaceutical products.
The current KNBWY market cap is 11.894B USD, and the company’s EPS TTM is 0.66 USD.
Company website: https://www.kirinholdings.com/en/
Heineken N.V(OTC:HEINY)
Heineken N. V. is a Dutch brewing company based in Amsterdam. It was founded on the 1st of January 1864. by Gerard Adriaan Heijmans and his brother-in-law Jules Franciscus van Maaren.
Today, it is part of the SABMiller group. In 2018, Heineken produced 3.5 million hectoliters of beer, making it the second-largest producer in the world behind Anheuser Busch InBev. And the third-largest worldwide.
The company sells in over 180 countries. It encompasses Heineken, Affligem, Amstel, Sol, Birra Moretti, Desperados, and various regional and local brands. Heineken also provides cider under the Strongbow, Orchard Thieves, and Follow The Fox brands.
The company sells its products to retailers, bars, pubs, hotels, restaurants, and other hospitality businesses in Europe, North America, South America, Africa, the Middle East, Eastern Europe, and Asia Pacific markets.
The current HEINY market cap is $56.105B, and P/E is 14.09.
Company website: https://www.heinekenholding.com/
Craft Brew Alliance, Inc(BREW.US)
Craft Brew Alliance, Inc is a company that makes and sells craft ciders, and beer has been growing at a fast pace for years.
The Craft Brew operates in two divisions, Brewpubs Operations and Beer Related Operations. It offers different types of beers under various brands, including Kona, Appalachian Mountain, Widmer Brothers, Cisco, Omission, and Redhook, and ciders under the name known as Square Mile.
Craft Brew Alliance sells its beer in cans, bottles, draft, and kegs at bars, liquor stores, restaurants, supermarkets, and convenience stores. In addition, it sells its beer directly to consumers at its brewery pubs and breweries. It also operates five pubs.
Founded in 1981 and headquartered in Portland, Oregon, the company has been growing steadily since then. As of September 2020, Craft Brew Alliance, Inc. operates as a subsidiary company of Anheuser-Bush Companies, LLC.
Company website: https://www.anheuser-busch.com
Tsingtao Brewery Company Limited (TSGTF.US)
Tsingtao Beer Company was founded in 1903. Its headquarters is in Qingdong, the Republic of China. Together with its subsidiaries, it produces, sells, distributes, and retails beer worldwide.
It operates through seven business units: Shandong Region, North, South, East, and Southeast China Region, Macau, Hong Kong, Other Overseas Region, and Finance Company.
The company mainly sells its beer products under the Laoshan and Tsingtau brands. It also offers wealth management, agency collections and payments, logistics, and construction services.
Company website: https://www.tsingtao.com/index.html
Conclusion
According to consistent consumer demand, beer consumption enjoys steady popularity. Because of this, some believe beer stocks are recession-proof.
Another benefit of investing in beer companies is the stable profit margins, which means they’re less likely to be affected by economic downturns. However, the regulatory risks that dominate this market make it difficult for startups to enter.
Overall, beer is a globally popular beverage generating substantial revenue for its most significant producers and shareholders. However, if you decide to include some beer stocks in your portfolio, be aware that some of them may exhibit volatile price action. Therefore, stay diversified and focus on the long-term potential for alcohol beverage manufacturers.
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This article was last updated on April 20th, 2022.
