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Beer Insights Extras

Extra beer business news, thoughts and insights from the publishers of Beer Marketer’s Insights, Insights Express, Craft Brew News, Beverage Business Insights and Alcohol Issues Insights.

#TBT - Beer Stocks in 2008 vs 2013

In today’s INSIGHTS Express we wrote about continued growth of beer stocks in 2013, including the immense success of Constellation and Boston Beer.  For a throwback we decided to look at an article we published in Jan 2009 about beer stocks the previous yr to see how 2013 stacked up against 2008 - when US beer volume reached its highest point ever.  Sales don’t always equate to higher stock prices, as we wrote in article dubbed “Tuff Yr for Beer Stocks Too,” in our first Insights Express issue of 2009.  Of course, this was in midst of the economic downturn, so stocks were down in most industries.  Now 5 yrs later, we’ve seen volume declines in 4 of last 5 yrs, yet  increased $$ sales and increased stock value.  Interesting to see how far many of these stocks  have come in just 5 yrs.  Take a look at the article below:


Tuff Yr for Beer Stocks Too (published Jan 5, 2009)  Beer industry stocks declined in 08, tho several did better than major indexes (S&P down 39% for yr, London exchange down about 2/3).  MolsonCoors stock price slipped 5.2% in 08 after 37% surge in 07.  SABMiller dropped 18% in 08, but has actually surged by almost 60% from its Oct lows.   Meanwhile, AB InBev sunk down to 10 Euros at its low, but since jumped back to over 17 Euros.  That’s still less than half its 08 peak (adjusting for new shares).  Heineken stock dropped 50.5% in 08 too; it had gained 23.7% in 07.  As for other alc bev stocks, the largest, Diageo, dropped by 34%.  And largest vintner (as well as half owner of Crown), Constellation Brands also fell by 1/3 to $15.77 in 08.  But it too surged 60% from Oct lows.   Craft brewers had rough 08 in mkts.  Boston Beer stock off 24.6% to $28.40 and Craft Brewers Alliance stock dropped 82% to $1.20 after closing 07 at $6.65.   So-called “vice” stocks, like alc bev, tobacco and gambling cos, are “often touted as great investments during economic downturns,” wrote Biz Week in article titled “Are Vice Stocks Losing Their Allure?”  In this downturn, “the naughty are still waiting for their reward.”  Biz Week concluded: “It remains to be seen if alcohol, tobacco and other vices continue to prosper as affordable luxuries for many people. Or if, desperate to cut costs, consumers decide to clean up their act.”  


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