STZ - Boston Beer: Hard Seltzer Bubble Has Popped Stock Is Below March 2020 Levels
- The Boston Beer Company is a well-known stock which has come down significantly in value over the last year.
- The share price rose meteorically in 2020 and topped out in 2021, due to a bubble being formed, in part by rapid growth of its Truly Hard Seltzer brand.
- The company initially overestimated demand for their hard seltzers, leading to an epic crash and continued bear market, which may be finally hitting a support level.
- With a Price-to-Sales ratio of 1.9, the stock is getting cheap given the continued revenue growth despite short-term operating margin collapse.
- Operating margins and ROE will normalize over time as supply chain issues and other problems get sorted out by management.
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Boston Beer: Hard Seltzer Bubble Has Popped, Stock Is Below March 2020 Levels