Boston Beer reported big losses for the quarter as shipments declined, raising concern on Wall Street about the stock.
Late Tuesday, the brewer said it shipped 1.5 million barrels of its drinks in the fourth quarter, a 12.2% decline from a year ago. Shipments declined from a year earlier in every quarter of 2023.
The company lost $1.49 a share, compared with a loss of 93 cents a year earlier and the 29-cent loss consensus call among analysts tracked by
FactSet.
Revenue dropped 12% from a year ago to $394 million, falling short of the consensus call for $414 million.
Boston Beer
said that in the first eight weeks of 2024, units sold at retail to the end consumer, or depletions, declined 2% from the same period in 2023.
Earnings are expected to be between $7 and $11 a share in the current year. Analysts had expected a profit of $11.29 a share.
The company also announced the retirement of its CEO Dave Burwick effective April 1. He’ll be succeeded by Michael Spillane.
Boston Beer’s stock, a Barron’s pick, fell 13% to $321 shortly after the markets opened on Wednesday.
Boston Beer’s products were popular during the pandemic, especially Truly, a hard cider offering. The brand has since shrunk to become a smaller part of the company’s portfolio. Management has been attempting to revive sales by toning down the bolder flavors of Truly.
CFRA’s Garrett Nelson doesn’t expect the company to regain its pandemic-era glory. After the results, he lowered his recommendation on the company’s stock to Sell, saying he expects the shares to fall to $275 within the next 12 months.
Peter Grom from
UBS
maintained a Neutral rating on the stock but lowered his target for the price to $355 from $390. He believes the brand can recover over many years, but said he struggles to have conviction in sales growth in the near term.
To be sure, there are positive drivers for Boston Beer: Twisted Tea, an ice tea with alcohol, is already nearly twice as large as Truly in the off-premises sales channels the company tracks. Management aims to heavily invest in the brand this year; it introduced a lower-calorie version last year.
Whether it can allay concerns around the company’s long-term growth prospects remains to be seen.
Write to Karishma Vanjani at [email protected].
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