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Boston Beer (SAM) to Report Q4 Earnings: What's in Store?

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The Boston Beer Company, Inc. SAM is slated to report fourth-quarter 2019 results on Feb 19. In the last reported quarter, the company delivered a positive earnings surprise of 28.3%. Moreover, its bottom line beat the Zacks Consensus Estimate over the trailing four quarters, delivering average surprise of nearly 42%.

The Zacks Consensus Estimate for fourth-quarter earnings is pegged at $1.42, implying a 22.8% decline from the year-earlier quarter's reported figure. Notably, the consensus mark has been unchanged over the past 30 days. For quarterly revenues, the Zacks Consensus Estimate stands at $277.1 million, suggesting 23% growth from the prior-year quarter reported figure.

Factors at Play

Boston Beer’s top line has been benefiting from sturdy depletions growth, improvement in shipment volumes and efforts to innovate brands. The company’s depletions have been robust on increases in its Truly Hard Seltzer and Twisted Tea brands. Particularly, it is expected to have gained from increased investments in the Truly brand, which has been bolstering its position in the fast-growing hard seltzer category.

The Boston Beer Company, Inc. Price and EPS Surprise


The Boston Beer Company, Inc. Price and EPS Surprise

The Boston Beer Company, Inc. price-eps-surprise | The Boston Beer Company, Inc. Quote

Moreover, major innovations, quality of products and strong brands alongside solid sales execution and support from distributors have collectively been aiding depletion. Also, efforts to manage inventory levels in the wake of increased customer demand are likely to have led to continued rise in shipments in the fourth quarter.

Additionally, the company’s commitment toward reviving its Samuel Adams and Angry Orchard brands, cost-saving initiatives, and innovation should have bolstered its performance.

However, incremental costs for the use of third-party breweries and introduction of variety packs have been denting gross margins. Additionally, higher advertising, promotional and selling expenses along with increased general and administrative costs are expected to have remained a threat to its overall profitability.

Zacks Model

Our proven model does not conclusively predict an earnings beat for Boston Beer this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Boston Beer has a Zacks Rank #1 and an Earnings ESP of 0.00%.

Stocks Likely to Deliver Earnings Beat

Here are some companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:

Coca Cola Femsa S.A.B. de C.V. (KOF - Free Report) has an Earnings ESP of +5.47% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Monster Beverage Corporation MNST has an Earnings ESP of +3.38% and a Zacks Rank #2.

The J. M. Smucker Company SJM presently has an Earnings ESP of +0.39% and a Zacks Rank #3.

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