Earlier today, we presented our 2024 Consumer Staples themes black book on the Beer Industry. We think updating our positioning in our 2024 outlook and 2023 review of the beer sector is important. 2023 was a year of muted stock price returns for the brewers but a dynamic year for market share changes.
We provided a preliminary review of the industry in 2023 and the events that shaped the year. Historically, the beer industry has been one of the most consistent in CPG in modestly raising prices annually. That approach put the brewers behind when a surge in inflationary cost increases from labor to cans forced price increases that lagged the broader CPG sector by half a year. We expect a reversal in some trends in 2024, including markedly fewer market share changes and a moderating cost outlook but a more challenging outlook for revenue growth.
Replay and materials link - CLICK HERE |
Our investment themes for the call:
We added Constellation Brands to the Best Idea Long list. We added AB InBev to the Best Idea Short list. We moved Molson Coors to the Long bias list and Boston Beer Company to the Short bias list.
Our call included:
- Review margin tailwinds and headwinds for 2024
- Highlight meaningful base effect occurrences
- Review market share changes
- Highlight demographic and economic trends impacting the sector
- Review the risk from GLP-1 drugs
- Highlight legal and regulatory outstanding items
- Where we differ on the company models from consensus
- How the Quad framework will impact the companies
- Review our actionable ideas and where we would be invested both long and short
