Take Advantage of Higher Beer Sales With These Two Stocks

May 4, 2020
311 Views

Beer sales are up during the Coronavirus Pandemic, creating a unique opportunity for investors. As hundreds of millions of people around the world are locked down in their homes, beer has become a simple comfort.

For a beverage that was recently losing out to alcoholic seltzers and spirit mixers, beer has made a strong comeback.

According to market research from inMarket, Busch Light sales have increased 44% since the Coronavirus outbreak hit the United States. Miller Light sales have increased within a range of 14% to 17%. Consumers are buying in bulk, with 24 and 30 packs of beer seeing a sales boost of around 90% in March.

It’s good news for the beverage companies and also for the wider economy. The alcoholic beverage industry creates jobs in agriculture, production, distribution, and retail. In the United States, domestic brands are leading the sales charts, thanks to competitive prices and ease of restocking.

Stocks That Can Benefit From The Current Trend

Mainstream beer brands are seeing the highest growth during the pandemic. More expensive craft beers with unfamiliar names are being left behind. The big breweries are the ideal targets for investment today.

  • Molson Coors Beverage Co. (NYSE: TAP) is the producer of Miller, Coors, Carling, Molson, and other popular beer brands. The stock is down in the year to date but it picked up some momentum on Friday when news of higher beer sales was released. The stock currently has a target price of $44.73, hinting at a moderate upside for investors. It comes with a dividend yield of 5.86%.
  • Anheuser-Busch InBev (NYSE: BUD) is the producer of Budweiser, Corona, Stella Artois, Becks, Castle, and other popular beer brands. This stock is also down in the year to date, and it was down -5.31% at the close of the market on Friday. However, like Molson Coors, there’s a strong estimated upside, with an average target price of $49.98. The stock offers a dividend yield of 3.33%.

Investing for the Long Term

The Coronavirus Pandemic has hinted at beer’s resilience, even when facing competition from flavored alcoholic beverages. With consumers unable to visit bars and restaurants, retail sales are soaring. Either of these picks would be ideal for a long term growth portfolio.

The fact that both stocks come with stable dividends makes them even more appealing in today’s low-interest rate environment.

You may be interested

Job Hiring is Picking Up as Employers and Consumers Gain Confidence
Economy
573 views
Economy
573 views

Job Hiring is Picking Up as Employers and Consumers Gain Confidence

Lamont J - March 29, 2021

The recent government stimulus for small and medium-sized businesses, personal stimulus checks, and declining Coronavirus cases, are all great news…

Fed Could Maintain 0% Interest Rate Until 2024
Economy
508 views
Economy
508 views

Fed Could Maintain 0% Interest Rate Until 2024

Adam R - March 26, 2021

The Federal Reserve is holding its target interest rate in a range of 0.00% - 0.25%, even while the economy…

Supply Constraints Could Slow the Home Market
Economy
581 views
Economy
581 views

Supply Constraints Could Slow the Home Market

Becky H - March 25, 2021

Low inventory has been a constant in the home market for more than a year. The supply of existing and…