Shares of the largest craft brewer of the United States, Boston Beer Co. Inc. (SAM), hit a new 52-week high of $309.81 on Jan 20, 2015. The stock eventually closed at $308.65, witnessing a rise of nearly 40% year over year.
Share price of Boston Beer has been gaining momentum based on the company’s robust brand portfolio, ongoing strategic initiatives, growth endeavors and strong quarterly performances.
This Boston, MA-based producer of beer, malt beverages and cider products commands a strong portfolio of globally recognized brands. Apart from selling alcoholic beverages in the United States, Boston Beer boasts of solid international presence, distributing its beverages in Canada, Europe, Israel, the Caribbean, the Pacific Rim, Mexico, and Central and South America through a formidable network of wholesale distributors.
Further, Boston Beer, which competes with Diageo plc (DEO), persistently seeks strategic opportunities to expand its business through organic growth. Since its inception, the company has made significant investment to acquire brewing assets, enhance research & development as well as in packaging and marketing of products. We believe that its growth strategies will certainly help the company in capturing considerable market share from its rivals.
Moreover, we applaud Boston Beer’s efforts to enhance wholesale distribution points and execute its strategic merchandising initiatives in order to boost sales.
These strong fundamentals have enabled the company to deliver robust quarterly performances as evident from the company’s third-quarter 2014 results, in which earnings of $2.79 per share surged 47.6% year over year and also came ahead of the Zacks Consensus Estimate of $2.35. Shares of the company have surged 39.1% since the earnings announcement on Oct 30.
Additionally, positive earnings surprises in two consecutive quarters along with revenue growth, an optimistic fiscal 2015 outlook and solid cash flows are the other positive factors that have been driving the stock upward.
We believe that these factors have triggered an uptrend in the Zacks Consensus Estimate, making investors more constructive on the stock’s future performance. The Zacks Consensus Estimate has climbed 1.2% to $6.70 and 2.7% to $8.02 for 2014 and 2015, respectively, over the past 90 days.
Other alcohol beverage companies that surged to the 52-week high spot yesterday include Constellation Brands Inc. (STZ) and Anheuser-Busch InBev SA/NV (BUD), reaching $112.00 and $118.25, respectively.
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