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CLICK HERE for the replay link. |
Nearly a year ago we added Boston Beer to our Best Ideas shortlist. We outlined our concerns that hard seltzer was a COVID-19 beneficiary, that product shortages would lead to excess supply, and that competitive intensity would increase. Earlier in the week we removed Boston Beer from our shortlist. We see the risk/reward as evenly balanced from here.
The hard seltzer category has been the biggest game-changer to beer since craft beer decades ago. What took craft beer three decades to reach, hard seltzer did in a little over three years. The growth has been phenomenal, but is it over? Was it a fad? Or is it a pause before resuming further growth? On Thursday we will provide an update to our hard seltzer Black Book from a little over a year ago, the competitive landscape, and our future projections. There are a number of questions to answer about the disruption in the beer category.
SAM is not a broken company and has a long history of outperforming the S&P 500 on a 5-year (144%), 10-year (153%), and 20-year basis (976%). After underperforming the S&P 500 by 13% over the past 2 years will the company return to its glory days, or are its best days behind it? We will answer that question and will provide our thoughts on what it would take to make us go long.
We also addressed if the hard seltzer category represents risk or opportunity for BUD, TAP and STZ. Does the category's slowdown bring relief or concern? 2022 will see share change hands again, who is best positioned to win some gains?
Our investment themes for the presentation:
