In this article, we discuss the 5 best liquor stocks to buy now. If you want our detailed analysis of the liquor industry and these stocks, go directly to the 11 Best Liquor Stocks to Buy Now.
5. Ambev S.A. (NYSE:ABEV)
Number of Hedge Fund Holders: 15
Ambev S.A. (NYSE:ABEV) is a Brazilian brewing company, and is one of the largest companies by market capitalization in the region. Founded in 1999, Ambev S.A. (NYSE:ABEV) was merged into Anheuser-Busch InBev SA/NV (NYSE:BUD) in 2008.
On October 28, the Q3 EPS for Ambev S.A. (NYSE:ABEV) came in at $0.04, beating estimates by $0.01. The $3.29 billion quarterly revenue also exceeded estimates by $263.5 million.
BofA analyst Isabella Simonato upgraded Ambev S.A. (NYSE:ABEV) to Neutral from Underperform with a price target of $3.50, up from $3.00 on November 3. The analyst stated that Ambev S.A. (NYSE:ABEV)’s “significant” volume beat in Q3 was testament to the success of its commercial beer strategy in Brazil, and the momentum may continue for at least the next two quarters. However, the stock is currently trading above historical valuation.
One of the leading Ambev S.A. (NYSE:ABEV) shareholders as of Q3 2021 is Pzena Investment Management, with 7.58 million shares amounting to almost $21 million. Overall, 15 hedge funds were bullish on Ambev S.A. (NYSE:ABEV) at the end of September, down from 18 funds in the preceding quarter.
Here is what Harding Loevner has to say about Ambev S.A. (NYSE:ABEV) in its Q2 2021 investor letter:
“By sector, good stocks in Information Technology (IT) and Consumer Staples were large positive contributors, offset by weaker results in Financials and Consumer Discretionary. In Consumer Staples, Brazil’s premier beer company Ambev posted impressive results helped by strong sales of premium brands and robust demand in its home market, which reduced the need for discounts.”
4. Diageo plc (NYSE:DEO)
Number of Hedge Fund Holders: 18
Diageo plc (NYSE:DEO) is a multinational beverage corporation, with operations and production facilities in more than 140 countries, and distribution across 180 countries. In addition to being one of the major players in the spirits market, Diageo plc (NYSE:DEO) is also the world’s largest producer of scotch whiskey.
Diageo plc (NYSE:DEO) posted its financial performance for FY2021. Revenue for the period totaled £12.73 million, up 8.3% year-over-year, comparable to the 2020 revenue of £11.75 million. Diageo plc (NYSE:DEO)’s earnings per share for 2021 equaled £1.13, increasing 89.4% as compared to the prior year EPS of £0.60.
On November 30, JPMorgan analyst Celine Pannuti raised the price target on Diageo plc (NYSE:DEO) to £4,350 from £3,800 and kept a Neutral rating on the shares.
Of the 18 hedge funds that were bullish on the company as per Insider Monkey’s Q3 database of elite funds, Nicolai Tangen’s Ako Capital is the leading Diageo plc (NYSE:DEO) stakeholder, holding 1.43 million shares worth $276.35 million.
Here is what Weitz Investment Management has to say about Diageo plc (NYSE:DEO) in its Q1 2021 investor letter:
“We sold Diageo after twelve years of very profitable ownership. The global spirits company has done a fine job of growing earnings, and the stock has enjoyed an extra boost from substantial, multiple expansions along the way. While the business is in good hands, we think a repeat of our mid-double-digit annualized return experience is far less likely. We simply see better risk/reward profiles in the Fund’s other quality holdings.”
3. Molson Coors Beverage Company (NYSE:TAP)
Number of Hedge Fund Holders: 29
Molson Coors Beverage Company (NYSE:TAP) is an American-Canadian brewing company that was created after Molson from Canada and Coors from the US merged in 2005. After acquiring Miller Brewing Company in 2016, Molson Coors Beverage Company (NYSE:TAP) became one of the largest alcoholic beverage companies. The product portfolio at Molson Coors Beverage Company (NYSE:TAP) includes Blue Moon, Coors Light, Miller Lite, and Milwaukee’s Best, among other beers, spirits, and wines.
Molson Coors Beverage Company (NYSE:TAP), on October 28, announced Q3 earnings. EPS in the quarter totaled $1.75, outperforming estimates by $0.24. The $2.82 billion revenue gained 2.51% year-over-year, but missed estimated revenue by -$91.44 million.
On October 18, Deutsche Bank analyst Steve Powers lowered the firm’s price target on Molson Coors Beverage Company (NYSE:TAP), to $48 from $50 and kept a Hold rating on the shares, citing supply chain bottlenecks and subdued demand due to COVID-19 pressures.
Out of the 867 hedge funds tracked by Insider Monkey as of Q3 2021, Ariel Investments is the leading Molson Coors Beverage Company (NYSE:TAP) stakeholder, holding a $35.6 million position in the company. Overall, 29 funds were bullish on Molson Coors Beverage Company (NYSE:TAP) at the end of September, down from 39 funds in the preceding quarter.
Here is what Argosy Investors has to say about Molson Coors Beverage Company (NYSE:TAP) in its Q2 2021 investor letter:
“TAP (+52% from August 2020 purchase to sale) was never intended to be a core position. I expected a couple of years of deleveraging and perhaps some excitement around the hard seltzer category, but the stock price increased faster than I expected. I have not fully exited these positions as I rarely do all in one trade, but hopefully this gives some perspective into my thinking on selling so quickly.”
2. Brown-Forman Corporation (NYSE:BF-B)
Number of Hedge Fund Holders: 31
Making it to our list of the best liquor stocks is one of the largest American manufacturers of spirits and wine, namely Brown-Forman Corporation (NYSE:BF-B). It is a Kentucky-based beverage company offering a wide range of liquor brands including Jack Daniel’s, Early Times, Old Forester, Woodford Reserve, and Chambord, among others.
On November 18, it was announced that Brown-Forman Corporation (NYSE:BF-B) increased its quarterly cash dividend on its Class A and Class B common stock by 5% to $0.1885 per share from the prior quarter’s $0.1795. The quarterly dividend will be paid on December 28 to shareholders on record as of December 3. In addition to that, $480 million will also be paid out on December 29 as a special one-time dividend to stakeholders of record on December 9.
Brown-Forman Corporation (NYSE:BF-B)’s leading stakeholder as of Q3 2021 is Terry Smith’s Fundsmith LLP, with 14.42 million shares amounting to $966.45 million. Overall, 31 hedge funds were long Brown-Forman Corporation (NYSE:BF-B) as of September, with total stakes amounting to $1.65 billion.
1. Constellation Brands, Inc. (NYSE:STZ)
Number of Hedge Fund Holders: 53
Constellation Brands, Inc. (NYSE:STZ) is the top ranked liquor stock on our list, with 53 hedge funds in the elite database of Insider Monkey being bullish on Constellation Brands, Inc. (NYSE:STZ), with a total stake value of $1.71 billion as of September 2021. Harris Associates is the leading stakeholder of the company, with over 4 million shares worth almost $850 million.
Constellation Brands, Inc. (NYSE:STZ) is an American producer and distributor of beer, wine, and spirits, owning more than 100 beverage brands. From its portfolio of local and imported alcoholic beverages, the most well known brands include Robert Mondavi, Richards Wild Irish Rose, Ravenswood Winery, Corona, Modelo Especial, Funky Buddha, and High West Whiskey, among others.
Q2 earnings were announced by Constellation Brands, Inc. (NYSE:STZ) on October 6, with EPS for the quarter coming in at $2.38, missing estimates by -$0.38. The $2.37 billion revenue was up 4.9% from the prior-year quarter, outperforming estimates by $69.49 million.
Following the second quarter earnings results, HSBC analyst Carlos Laboy on October 13 upgraded Constellation Brands, Inc. (NYSE:STZ) to Buy from Hold with a price target of $262, up from $254. The analyst stated that demand for Constellation Brands, Inc. (NYSE:STZ) was strong, and the company had solid fundamentals.
You can also take a look at 10 Best Oil Stocks To Buy According To Hedge Funds and 20 Safe Dividend Stocks to Quit Your 9 to 5 Job.
