In this article, we will discuss the 5 best whiskey and alcohol stocks to buy in 2022. If you want to read our detailed analysis of the liquor industry which highlights key trends and major players, you can go to 10 Best Whiskey and Alcohol Stocks To Buy in 2022.
5. Diageo plc (NYSE:DEO)
Number of Hedge Fund Holders: 19
Diageo plc (NYSE:DEO) operates as a beverage alcohol company in more than 180 countries with over 140 production sites all across the globe. The company offers premium liquors such as scotch, whisky, gin, vodka, and rum, through its prominent top-selling brands such as Johnnie Walker, Crown Royal, Bulleit, and Buchanan’s whiskies. Diageo plc (NYSE:DEO) is one of the largest distillers in the world and is among the best-performing companies in the liquor industry, which makes it stand among the 5 best whiskey and alcohol stocks to buy in 2022.
This April, Societe Generale analyst Toby McCullagh raised his price target on Diageo plc (NYSE:DEO) to 4,500 GBP from 4,250 GBP and reiterated a Buy rating on the shares.
Hedge funds are piling into Diageo plc (NYSE:DEO). Insider Monkey found that at the end of the fourth quarter of 2021, 19 hedge funds were long Diageo plc (NYSE:DEO) with stakes worth $935.93 million. This is compared to 18 hedge funds in the third quarter of 2021, with stakes worth $703.94 million.
As of March 31, 2022, Ako Capital is the most bullish on Diageo plc (NYSE:DEO) owning more than 1.6 million shares of the stock which equates to a stake value of $341.61 million.
Investment management firm Lindsell Train mentioned Diageo plc (NYSE:DEO) in its fourth-quarter 2021 investor letter. Here is what the firm had to say:
“A very important aspect of the rationale for investing in this smaller and more rarefied category is the fact that alcohol brands with a premium or luxury positioning tend to be highly differentiated, with a greater ability to increase prices over time than a “value” or mass market brand – even in downturns or periods of turbulence. Over time, these inflation-busting protective qualities usually result in considerable value creation: in January this year, against a backdrop of a sharp increase in input cost prices, Diageo reported increased operating profit margins – crucially, driven by price increases rather than cost savings – and indicated an expectation of operating profit growth of between 6 and 9% to 2025. Such an outlook would not be possible without a portfolio of beverages enjoying substantial pricing power.” (Click here to see the full text)
4. The Boston Beer Company, Inc. (NYSE:SAM)
Number of Hedge Fund Holders: 32
The Boston Beer Company, Inc. (NYSE:SAM) produces and sells alcoholic beverages primarily in the United States. The company’s flagship beer is the Samuel Adams Boston Lager and it sells its beverages to a network of approximately 400 wholesalers in the United States, Canada, Europe, Israel, Australia, New Zealand, the Caribbean, the Pacific Rim, Mexico, and Central and South America.
On February 16, 2022, Jim Koch, the chairman and founder of The Boston Beer Company, Inc. (NYSE:SAM), shared that he is targeting full-year volume growth between 4% and 10% for the fiscal year 2022 as the company’s inventory levels recover. Positive outlooks and an ambitious FY 2022 guidance place The Boston Beer Company, Inc. (NYSE:SAM) among the 5 best whiskey and alcohol stocks to buy in 2022.
Shortly after the company’s earnings release, on April 22, Credit Suisse analyst Kaumil Gajrawala cut his price target on The Boston Beer Company, Inc. (NYSE:SAM) to $620 from $670 but reiterated an Outperform rating on the shares. The analyst contended that the company reported positive results for the quarter after a series of weak quarters and believes that the company’s maintained EPS and revenue guidance signals sustainable growth.
The Boston Beer Company, Inc. (NYSE:SAM) is being closely watched by elite hedge funds. At the end of Q4 2021, 32 hedge funds held long positions in The Boston Beer Company, Inc. (NYSE:SAM). The total stakes of these funds amounted to $454.15 million, up from $237.87 million in the previous quarter with 19 positions. The hedge fund sentiment for the stock is positive.
Durable Capital Partners is the most prominent shareholder in The Boston Beer Company, Inc. (NYSE:SAM) as of the end of this March. The fund’s stakes were valued at $55.37 million which represents 0.48% of its 13F portfolio.
Artisan Partners, a high value-added investment management firm, shared its views on The Boston Beer Company, Inc. (NYSE:SAM) in its third-quarter 2021 investor letter. Here is what experts at Artisan said:
“We ended our campaigns in Boston Beer Company. Boston Beer Company sells a focused portfolio of alcoholic beverage brands. In recent years, the company has emerged as one of the leaders in the hard seltzer category, which has grown over 150% in each of the past three years (2018-2020). Boston Beer’s Truly brand, the second-largest seller of hard seltzer, has benefited from this growth and was core to our investment thesis. However, the hard seltzer category’s growth has recently slowed to single digits, falling short of high investor expectations and pressuring Boston Beer’s earnings upside. Truly’s growth was core to our investment thesis, and a recovery is uncertain; thus, we ended our investment campaign.”
3. Molson Coors Beverage Company (NYSE:TAP)
Number of Hedge Fund Holders: 33
Molson Coors Beverage Company (NYSE:TAP) manufactures and sells beer and other malt beverage products in the Americas, Europe, Middle East, Africa, and the Asia Pacific. Molson Coors Beverage Company (NYSE:TAP) is gaining momentum and as of May 13, the stock has surged 13.66% over the past six months.
On May 3, Molson Coors Beverage Company (NYSE:TAP) reported market-beating earnings for the fiscal first quarter of 2022. The company’s earnings per share were valued at $0.29, beating EPS estimates by $0.10. The company’s revenues grew 16.66% year-over-year and came in at $2.21 billion, outperforming revenue estimates by $71.90 million.
Shortly after Molson Coors Beverage Company (NYSE:TAP) posted a profitable quarter, Citi analyst Wendy Nicholson raised her price target on the stock to $61 from $58 and reiterated a Buy rating on the shares.
Molson Coors Beverage Company (NYSE:TAP) is becoming an investor’s favorite. According to Insider Monkey’s database, 33 hedge funds were long Molson Coors Beverage Company (NYSE:TAP) at the end of Q4 2021. The stakes of these funds totaled 325.64 million, up from $236.76 million in the previous quarter with 29 positions.
As of the end of March 2022, Ariel Investments is the leading hedge fund having stakes in Molson Coors Beverage Company (NYSE:TAP). According to Insider Monkey, the fund’s stakes amounted to $40.41 million, which covers 0.35% its investment portfolio.
2. Brown-Forman Corporation (NYSE:BF.B)
Number of Hedge Fund Holders: 34
Brown-Forman Corporation (NYSE:BF.B) manufactures, distills, and sells various alcoholic beverages. The company boasts a portfolio of premium brands, including Jack Daniel’s, Woodford Reserve, Old Forester, GlenDronach, Benriach, Glenglassaugh, Slane Irish Whiskey, and Korbel Champagne among others. Brown-Forman Corporation (NYSE:BF.B) is one of the largest companies in the liquor business by market share, which stands at $31.32 billion as of May 13, and is also the owner of the most premium beer brands which justifies the stock’s runner-up rank among the 10 best whiskey and alcohol stocks to buy in 2022.
On March 30, 2022, JPMorgan analyst Andrea Teixeira lowered her price target on Brown-Forman Corporation (NYSE:BF.B) to $73 from $76 and reiterated a Neutral rating on the shares. Teixeira slashed her price target to reflect the impact of the Ukraine conflict on commodities costs, transportation, and currency, however, she expects demand to remain robust as consumers continue to favor brands over private labels.
Insider Monkey spotted Brown-Forman Corporation (NYSE:BF.B) on 34 investment portfolios at the close of the fourth quarter of 2021. The total stakes of these funds were valued at $1.87 billion. This is compared to $1.65 billion in the preceding quarter with 31 positions. The hedge fund sentiment for the stock is positive.
As of March 31, Gardner Russo & Gardner is the most prominent stakeholder in Brown-Forman Corporation (NYSE:BF.B) with more than 2.7 million shares of stock which amount to a stake of $169.43 million. The investment covers 1.63% of its 13F portfolio.
1. Constellation Brands, Inc. (NYSE:STZ)
Number of Hedge Fund Holders: 48
Constellation Brands, Inc. (NYSE:STZ) produces, imports, and sells alcoholic beverages in the United States, Canada, Mexico, New Zealand, and Italy. The company boasts a portfolio of premium alcohol brands including Corona Extra, Corona Light, Modelo Especial, Modelo Negra, Pacifico, 7 Moons, Cook’s California Champagne, Cooper & Thief, Crafters Union, and Kim Crawford among others. Constellation Brands, Inc. (NYSE:STZ) is packing up momentum and as of May 13, the stock has appreciated by 8.78% over the past six months, which makes it a high-momentum whiskey and alcohol stock to buy in 2022.
On April 7, Constellation Brands, Inc. (NYSE:STZ) reported a profitable fiscal fourth quarter for 2022. The company reported earnings per share of $2.37 and beat estimates by $0.25. Moreover, the company’s revenues were valued at $2.10 billion, up 7.65% year over year, and outperformed market consensus by a hefty $85.60 million.
Shortly after Constellation Brands, Inc. (NYSE:STZ) posted market-beating earnings, JPMorgan analyst Andrea Teixeira slashed her price target on the stock to $271 from $276 but maintained an Overweight rating on the shares. Teixeira noted that the company’s operational performance demonstrates strength in beer with depletions nearly up 10% in the quarter despite a difficult January and the impact of the Omicron variant. The analyst further stated that Constellation Brands, Inc. (NYSE:STZ) is on the path to gaining momentum from beer sales, naming the company the “best GARP” in her note to investors.
Hedge funds are making sizeable investments in Constellation Brands, Inc. (NYSE:STZ). At the end of the fourth quarter of 2021, 48 hedge funds were long Constellation Brands, Inc. (NYSE:STZ) with stakes worth $1.31 billion.
Arrowstreet Capital is the most bullish hedge fund on Constellation Brands, Inc. (NYSE:STZ) as of March 2022. The fund’s stakes came in at $236.91 million, which covers 0.29% of its 13F portfolio.
You can also take a look at 10 Weed Stocks to Buy in 2022 and 15 Most Valuable Cigarette Companies in the World.
