In retrospect, investors spent the last few months focused on the wrong thing. Rather than trying to figure out when the first mainstream beverage company might finally launch a cannabis-infused drink, we should have been focused on the newest beverage mania that actually was taking shape. A whole (relatively) new category of alcoholic beverages has taken that more adult piece of the beverage spectrum by storm, and brewer Boston Beer Company (NYSE: SAM) just secured its fourth upgrade in less than a month because of its stake in the nascent market.
All of them were a little late to the party, to be fair. Boston Beer shares have been advancing all year, up 62% since the end of 2018, largely on the heels of incredible demand for its Truly brand of hard seltzers. And although rival Anheuser-Busch InBev (NYSE: BUD) controls twice as much share of the hard seltzer market with its White Claw brand and drove 289% growth in sales volume last year, Boston Beer's Truly line of these seltzers saw 278% growth in volume in 2018.
The stock was performing well then, too. The end result is a valuation most investors might not like. Shares are priced at nearly 35 times next year's expected earnings.