10 Best Alcohol Stocks To Own According to Hedge Funds

4. Brown-Forman Corporation (NYSE:BF-B)

Number of Hedge Fund Holders: 32

Brown-Forman Corporation (NYSE:BF-B) is placed at number 4 among the Best Alcohol Stocks to Buy Right Now According to Hedge Funds. The company engages in the production, distillation, bottling, import, export, marketing, and sale of a wide range of alcoholic beverages, with a special emphasis on spirits. This puts the company in a commanding position in the American market where spirits are gaining more and more traction every day.

BF’s Jack Daniel’s brand is included among the Most Popular Whiskey Brands in the World and contributes significantly to its revenue. However, the iconic brand has been facing some headwinds recently due to a hike in prices, as consumers look for cheaper alternatives. Sales of Jack Daniel’s Tennessee Whiskey dropped by 6% in Q4 ending April 30th, 2024, building on the already 6% sales decline in the previous quarter.

As a result, Brown-Forman Corporation (NYSE:BF-B)’s revenue for its fiscal year 2024 declined by over 1% to reach approximately $4.28 billion. This also caused its stock price to plummet by over 20% since the beginning of the year. The company is facing challenges mostly due to a subdued, inflation-driven consumer demand and hence also increasingly cautious retailers and distributors. But this is not something that is unique to BF-B, with CEO Lawson Whiting calling fiscal year 2024 ‘a challenging year within the spirits industry.’

There was good news from the Ready-to-Drink (RTD) category though, with sales going up 2% during the year. Moreover, the declines in the US market were largely offset by growth in emerging markets (up 8%) and travel retail (up 6%).

Brown-Forman Corporation (NYSE:BF-B) paid $404 million to stockholders through its regular quarterly dividend and returned $400 million to stockholders through its share repurchase program in fiscal year 2024. The company is a member of the prestigious S&P 500 Dividend Aristocrats index and its 10-year compound annual dividend growth rate comes in at 7.86%.