Friday, January 28, 2011

What's going on in the world of brewing for 1/28/11?

  • BUD: $56.47
  • SAM: $89.76
  • TAP: $46.51
Well, this certainly was a rough week for me with the stock prices of my three companies in the beer industry. First off, on a positive note, Anhueser Busch (BUD) started making a comeback in there stock prices amidst last weeks prices of $55.70. BUD made a rise to $56.47 for today's closing prices showing a 1.4% increase from last week. Meanwhile, both The Boston Beer Company (SAM) and MolsonCoors LLC (TAP) didn't look so impressive. SAM's prices dropped from $91.21 last week to $89.76 this week showing a decrease of 1.45%, while TAP's prices dropped from $48.78 down to $46.51 which was an unsettling decrease of 2.27%. Things aren't looking very good right now, but I am certainly trying to stay optimistic for what the future holds for these three companies.

On a better note, news this week in the beer industry is revolving around a couple key stories. The first of which is Anheuser-Busch's recent decision to use Facebook to help build interest in their Super Bowl XLV(45) ad's and to help build brand awareness to fans all over. Their hopes with this campaign is to try to use the popularity of these social networking sites to target consumers and to help pick up much needed sales after what has been a slump in demand for their flagship beer Bud Light. The Facebook ad's are inviting people to view images and small portions of the upcoming commercials in an effort to encourage increasingly more popularity for "the big game" and the entertaining commercials/advertisements of their's that will accompany it.
The second story on the table today is about a Czech brewing company by the name of Budvar. Budvar is making astonishing growth right now and reported that their exports are at record highs right now. Their exports rose and astonishing 4.3% to the point that they exported 15.98 million gallons ( 604,791 hectoliters) to over 58 countries over the course of the year. With a 4.7% increase in Germany, their most important market, and a 4% increase in the U.S., through a distribution deal with their archrival Anheuser-Busch, they have made amazing progress. Now, the key is going to be whether or not they can keep that momentum going. Many industry analysts have high doubts and some have forecasted Budvar's exporting could decrease by roughly 12% . This certainly will be another case where time tells all.

Next, Diageo, the world's leading premium distilled spirits, beer and wine company, is on the road to a greener future with its fleet of more efficient corporate vehicles.Diageo is the world's leading premium drinks business with an outstanding collection of beverage alcohol brands across spirits, beer and wines. These brands include Johnnie Walker, Guinness, Smirnoff, J&B, Baileys, Cuervo, Tanqueray and Captain Morgan. Diageo is a global company, with its products sold in more than 180 countries around the world. The company is listed on both the New York Stock Exchange (DEO) and the London Stock Exchange (DGE). The company announced today that it achieved carbon neutral status for its North American corporate fleet in 2010, a milestone in company efforts towards improved sustainability. In recognition of this accomplishment, Emkay's GoGREEN program recently granted Diageo North America its "Green Fleet" status. During the past year, the company's fleet of 346 vehicles drove more than 7 million miles and increased its average MPG by 1.5 miles to 22 MPG.  Over the past five years, Diageo has improved its average MPG from 17.5 MPG to 22 MPG, representing a 26% improvement. Additional improvements in 2011 will include replacing remaining six-cylinder vehicles wherever possible with four-cylinder cars with greater fuel efficiency, as well as optimizing the effects of fleet hybrid vehicles and reducing the count of older, non-Hybrid vehicles within the fleet in areas where this improves efficiency.  As Diageo continues these activities, Emkay predicts that the company's average MPG will improve from 22 MPG in 2010 to 25 MPG in 2011.  These efforts in their "greener" operations should allow them to save drastically on costs incurred and show a great deal of better earnings statements as the months go on.
 Well, until next week, I take a quote from the Dos Equis commercials when I say " stay thirsty my friends!"

Saturday, January 22, 2011

The beer industry as of January 21,2011

  • TAP: $48.78
  • BUD: $55.70
  • SAM: $91.21
Well, here we go. Week two in the books and an up and down week for the beer stocks. First off, only one of my three chosen companies made a rise this week in prices and that was Molson Coors (TAP) whose stocks rose from $47.70 last Friday to $48.78 up 2.25%.  Anheuser-Busch InBev (BUD) had stock prices drop 3.8% as they sank from $57.91 down to $55.70. And lastly, The Boston Beer Company (SAM) had their stocks drop 1.78% as they went down from $92.87 to $91.21 this week.

Next, its Super Bowl fever and Anheuser-Busch is the front-runner for advertising. Spending around 20 to 25 million dollars total in advertising, they will be the sole beer company showing advertisements during the Super Bowl for the 23rd straight year. Going with a "wild west" theme and bringing back our favorite Clydesdales, they are expected to have some very entertaining commercials to say the least. As for me, I am really hoping these will generate some much needed attraction to Anheuser-Busch since being bought out by Belgium company InBev back in 2008. One unique feature of this years Super Bowl advertisements is that during the Anheuser Busch commercials they will not only be advertising their flagship brews of Budweiser and Bud Light but they will also be advertising the Belgium brewed Stella Artois. I guess that's InBev's way of still making things clear to all those who were unsure that they are, in fact, the one's with control of the reins when it comes to our beloved Anheuser-Busch and the many brands they encompass. Well I certainly hope that with the exclusive and extravagant advertising they will be doing it can boost sales which will boost stocks also.
Also, Drinks Americas Holdings, Ltd., a leading developer and marketer of beverage products announced that Rheingold Beer is now being sold in Ohio and Kentucky through Stagnaro Distributing. Drinks Americas launched Rheingold in September 2010, and it is now being sold in New York, New Jersey, Connecticut, Pennsylvania, Georgia, Ohio, and Kentucky with definitive plans to expand to Florida, Michigan, Texas, Maryland, Washington DC, Illinois, Oklahoma, West Virginia and Massachusetts.
Drinks Americas develops, owns, markets, and nationally distributes alcoholic premium beverages including Willie Nelson's Old Whiskey River Bourbon ,Trump Super Premium Vodka, Olifant Vodka, Damiaia, Aguila Tequila and Rheingold Beer. The company is very exicted to have been able to put this process in force in time for the Super Bowl and the sales that it brings to the brewing industry.
To date, over the first four months of Rheingold business, the Company has shipped approximately $200,000 of Rheingold Beer in a combination of more than 21,000 can and bottle packs. The Company expects to launch Rheingold in kegs in mid to late 2011.

Sunday, January 16, 2011

The beer stock as of January 14, 2011

      Well, here we go!  $60,000.00 invested and high hopes for my stocks in the beer industry this semester and this year in general.

     To start my investment discussion, I am going to focus this week on The Boston Beer Co. (SAM).  Everything for this company started in 1984 when Founder and Brewer Jim Koch stumbled across a generations-old family recipe designed by his great-great grandfather. Brewing started in Jim's kitchen and from there he went around to all the local bars in Boston in hopes of spreading his family's wealth of knowledge for a full-flavored and complex beer that we now know as Samual Adam's Boston Lager and what became the start of the craft beer revolution. SAM is traded publicly on the New York Stock Exchange and has seen amazing growths over the course of the last year. For 2010, SAM saw a revenue growth of over 12% and stocks rose from $46.60 to an astonishing $99.53 before year's end which was more than a 100% increase. Stocks are down a little with the holidays being over leaving our Friday January 14, 2011 closing prices at $92.87. With the price of hops staying low and the demand for craft beer continuing to grow tremendously, I expect that it won't be long before stock in SAM  is well over the $100 mark.
       My other two companies for my stock portfolio project would be the beer industry giants of Molson Coors Brewing Co. (TAP) and Anheuser-Busch InBev (BUD). TAP saw stocks drop .48% on Friday from Thursday's closing price to $47.70. BUD's stock also went down in value with a loss of 1.31% bring their closing for Friday down to $57.91.
      Overall, I foresee a successful and recession proof investment that I have made by choosing this industry and only time will tell how accurate that is.