BUD - Hard Seltzer Market Made Boston Beer Company A Big 2020 Winner But Relative Valuation Suggests Downside
- The Boston Beer Co. delivered 35% revenue growth and 60% growth in EPS in 9M20. The strong 200% growth of truly hard seltzer brands compensated the drop in beer sales.
- SAM's share jumped 120% since mid February 2020 and tripled since its March lows, while other beer companies suffered price drops back in March and haven't recovered since.
- Based on the relative valuation and 2021 EPS we estimate SAM's fair share price at $600, or at 33% downside to the current market price.
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Hard Seltzer Market Made Boston Beer Company A Big 2020 Winner, But Relative Valuation Suggests Downside