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Boston Beer's Diligent Efforts Bode Well: Should You Add?
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You must count on The Boston Beer Company, Inc. (SAM - Free Report) as it is progressing well, with strategic initiatives and expansion through acquisitions. Notably, it commands a robust portfolio of globally recognized brands and is amongst the largest U.S. premium craft brewers. In addition, management’s plan of aligning costs with volumes is likely to improve its performance, moving ahead.
Thanks to these factors, the company has outperformed the Zacks categorized industry in the past three months. Over the said time frame, the stock yielded a return of 9%, while the Zacks categorized Beverages-Alcoholic industry’s declined 16%. Further, this Zacks Rank #2 (Buy) company boasts a Growth Score of “A” with a long-term earnings growth rate of 12%, which clearly speaks about its inherent strength.
Boston Beer remains keen on reinforcing its business through inorganic means. Moreover, its brand-building efforts and initiatives to add new products to its portfolio remain key revenue drivers. It mainly focuses on acquiring assets, which can fulfill its goal of enhancing brewing capacity, as well as expanding into new geographic regions. These moves are likely to aid the company in gaining significant market share.
Apart from selling alcoholic beverages in the U.S., Boston Beer distributes its beverages in Canada, Europe, Australia, New Zealand, Israel, the Caribbean, the Pacific Rim, Mexico, and Central and South America through a sturdy network of wholesale distributors. We expect the company’s constant focus on pricing, product innovation and brand development to boost its operational performance, going forward.
Further, management remains committed to a three-point growth plan focused on revival of its Samuel Adams and Angry Orchard brands, cost-saving initiatives and long-term innovation. Moving ahead, the company plans to add two new beers – Samuel Adams Hopscape and Samuel Adams Fresh as Helles – in early 2017.
We believe that the company’s strategic endeavors may help alleviate gross margin pressure that has been contracting since the last three quarters. Management had also trimmed its earnings and depletions outlook for 2016, following the lackluster third-quarter results and soft depletion trends. However, we noticed that estimates have been stable, lately, ahead of the fourth-quarter earnings release.
Another well-ranked stock in the same industry is Constellation Brands, Inc. (STZ - Free Report) , also carrying a Zacks Rank #2. Some other stocks worth considering in the broader consumer staples sector include Dean Foods Company and Ollie's Bargain Outlet Holdings, Inc. (OLLI - Free Report) , both sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Constellation Brands posted an average positive earnings surprise of 5.8% in the trailing four quarters. Moreover, the stock has a long-term earnings growth rate of 18.9%.
Dean Foods, with a long-term earnings growth rate of 12%, has gained roughly 25.3% year to date.
Ollie's Bargain has surged a whopping 71.4% year to date. Moreover, it has a long-term earnings growth rate of 18.9%.
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Boston Beer's Diligent Efforts Bode Well: Should You Add?
You must count on The Boston Beer Company, Inc. (SAM - Free Report) as it is progressing well, with strategic initiatives and expansion through acquisitions. Notably, it commands a robust portfolio of globally recognized brands and is amongst the largest U.S. premium craft brewers. In addition, management’s plan of aligning costs with volumes is likely to improve its performance, moving ahead.
Thanks to these factors, the company has outperformed the Zacks categorized industry in the past three months. Over the said time frame, the stock yielded a return of 9%, while the Zacks categorized Beverages-Alcoholic industry’s declined 16%. Further, this Zacks Rank #2 (Buy) company boasts a Growth Score of “A” with a long-term earnings growth rate of 12%, which clearly speaks about its inherent strength.
Boston Beer remains keen on reinforcing its business through inorganic means. Moreover, its brand-building efforts and initiatives to add new products to its portfolio remain key revenue drivers. It mainly focuses on acquiring assets, which can fulfill its goal of enhancing brewing capacity, as well as expanding into new geographic regions. These moves are likely to aid the company in gaining significant market share.
Apart from selling alcoholic beverages in the U.S., Boston Beer distributes its beverages in Canada, Europe, Australia, New Zealand, Israel, the Caribbean, the Pacific Rim, Mexico, and Central and South America through a sturdy network of wholesale distributors. We expect the company’s constant focus on pricing, product innovation and brand development to boost its operational performance, going forward.
Further, management remains committed to a three-point growth plan focused on revival of its Samuel Adams and Angry Orchard brands, cost-saving initiatives and long-term innovation. Moving ahead, the company plans to add two new beers – Samuel Adams Hopscape and Samuel Adams Fresh as Helles – in early 2017.
We believe that the company’s strategic endeavors may help alleviate gross margin pressure that has been contracting since the last three quarters. Management had also trimmed its earnings and depletions outlook for 2016, following the lackluster third-quarter results and soft depletion trends. However, we noticed that estimates have been stable, lately, ahead of the fourth-quarter earnings release.
BOSTON BEER INC Price and Consensus
BOSTON BEER INC Price and Consensus | BOSTON BEER INC Quote
Other Stocks You May Consider
Another well-ranked stock in the same industry is Constellation Brands, Inc. (STZ - Free Report) , also carrying a Zacks Rank #2. Some other stocks worth considering in the broader consumer staples sector include Dean Foods Company and Ollie's Bargain Outlet Holdings, Inc. (OLLI - Free Report) , both sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Constellation Brands posted an average positive earnings surprise of 5.8% in the trailing four quarters. Moreover, the stock has a long-term earnings growth rate of 18.9%.
Dean Foods, with a long-term earnings growth rate of 12%, has gained roughly 25.3% year to date.
Ollie's Bargain has surged a whopping 71.4% year to date. Moreover, it has a long-term earnings growth rate of 18.9%.
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>