On Thursday, Bernstein analysts adjusted their outlook on Boston Beer (NYSE:SAM) Company shares, increasing the price target to $315 from the previous $305. The firm kept a "Market Perform" rating on the stock, as shares currently trade at $275.39.
The revision reflects the latest earnings guidance from the company and a moderated revenue forecast due to weaker scanner data. According to InvestingPro data, analyst targets for the stock range from $230 to $389, with four analysts recently revising their earnings expectations downward.
The analysts noted that Boston Beer continues to experience significant declines in its Truly brand and a slowdown in the growth of Twisted Tea. Despite these challenges, the new price target indicates a slight optimism based on the updated earnings forecast provided by Boston Beer Company. The stock has experienced significant pressure, declining 8.59% in the past week, though InvestingPro analysis suggests the stock is currently in oversold territory.
Boston Beer Company, listed on the New York Stock Exchange under the ticker NYSE:SAM, has been navigating a competitive and shifting market landscape. The company's performance is closely monitored by investors looking to understand the impacts of consumer trends and market dynamics on its portfolio of products.
The updated price target from Bernstein comes as the company adapts to the evolving preferences of consumers, who have shown fluctuating demand for Boston Beer's offerings. The firm's decision to maintain the "Market Perform" rating suggests a neutral stance on the stock's potential to outperform or underperform the market.
In other recent news, Boston Beer Company experienced a slight rise in revenue by 0.6% despite a 3% decrease in shipments and depletions, as reported in its Q3 2024 earnings call. The company's improved gross margin of 46.3% was driven by pricing strategies and procurement savings.
Boston Beer Company also launched new products "Just the Haze" and "American Light," with plans for their national expansion in early 2025. The company recorded a noncash impairment charge of $42.6 million for the Dogfish Head brand and increased its share repurchase authorization to $1.6 billion, with $191 million in shares already repurchased.
In discussions with Citi, Boston Beer Company's management team indicated improvements in market conditions as of October, despite potential volatility. The team expressed confidence in the company's ability to grow its core brands and innovate new products, specifically highlighting the potential of Twisted Tea. Citi reaffirmed its Neutral stance on Boston Beer Company, maintaining its price target of $305.00.
Boston Beer Company has narrowed its volume guidance for 2024, expecting depletions and shipments to decline by low single digits. The company's gross margin projections for 2024 are between 44% and 45%, with capital expenditures estimated to be between $80 million and $95 million. The company anticipates a projected negative EPS of approximately $2 for Q4 due to shortfall fees and sensitivity to volume fluctuations.
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