2023-04-11 13:48:18 ET
Falling sales volumes for Bud Light after a controversial ad campaign could ripple across its supply chain, according to Truist.
Per a report “unpacking the Bud Light backlash” in Beer Business Daily, AB InBev’s ( BUD ) ABud Light brand saw notable volume declines in some markets for the Easter weekend. The drop in demand could be linked to a new marketing campaign featuring transgender activist and social media influencer Dylan Mulvaney, according to the report.
“We dispense with any discussion of politics or social issues, but note that the publication stated that some ABI distributors in the Heartland and South were increasingly cautious given negative consumer reaction,” Truist analyst Michael Roxland wrote in a reaction to the report. “This is important for Ball Corp. ( NYSE: BALL ) as ABI comprised ~13% of BALL’s sales in 2022 and mass beer/soft drinks accounted for ~70% of BALL’s business in North America.”
Given Bud Light is the top selling brand for Anheuser Busche ( BUD ), the impact could be particularly outsized. Roxland maintained a Hold rating on Ball Corporation ( BALL ), but noted that North America volumes “could be pressured should this issue persist” and advised caution as the true impact of the campaign becomes clearer.
Shares of AB InBev ( BUD ) rose 0.8% on Tuesday while Ball Corporation ( BALL ) stock rose 1.84% .
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Bud Light ad controversy could sting suppliers - Truist