Shares of the largest craft brewer of the United States, Boston Beer Co. Inc. (SAM) have been riding on the company’s strong quarterly performance, its robust brand portfolio, continuous strategic initiatives and growth endeavors.
Apart from selling alcoholic beverages in the United States, Boston Beer distributes its beverages in Canada, Europe, Israel, the Caribbean, the Pacific Rim, Mexico, and Central and South America through a formidable network of wholesale distributors, highlighting its solid international presence.
Further, the company is always seeking strategic opportunities to expand its business through organic growth. Since its inception, the company has made significant investment toward acquiring brewing assets, enhancing research & development as well as packaging and marketing of products. We believe that its growth strategies will certainly help it capture considerable market share from its rivals.
Moreover, we appreciate Boston Beer’s efforts to enhance wholesale distribution points and execute its strategic merchandising initiatives to boost sales.
These strong fundamentals have been enabling the company to deliver robust quarterly performances as evident from the company’s third-quarter 2014 results where its earnings of $2.79 per share surged 47.6% year over year and also came well ahead of the Zacks Consensus Estimate of $2.35. Shares of the company have jumped 20.2% since the earnings announcement on Oct 30.
Positive earnings surprises in two consecutive quarters along with revenue growth, an optimistic fiscal 2015 outlook and solid cash flows are the positives that led the shares of this Zacks Rank #2 (Buy) company to hit 52-week high of $284.06, yesterday. However, the stock eventually closed at $278.22, up 25.3% year-to-date.
We believe that all these aforementioned factors hint at a positive future for the company, instilling confidence among investors. Additionally, Boston Beer’s last traded price is 3.9% below the Zacks Consensus average analyst price target of $289.50, leaving further room for an upside stock potential.
Apart from Boston Beer, The Kroger Co. (KR), Lowe's Companies Inc. (LOW) and Dollar General Corporation (DG) also hit highs of $62.39, $66.39 and $70.06, respectively, on Dec 10, 2014.
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