Bad news these days isn’t all that new at beer maker Boston Beer (NASDAQ:SAM). Especially bad news connected to analysts changing their position. Boston Beer lost over 14% in Thursday’s trading, thanks mainly to another analyst reconsidering. This time, Boston Beer lost the support of Nadine Sarwat of Bernstein. Sarwat declared that it was time to “rip off the band-aid” and did so by cutting Boston Beer down to a Sell rating.
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The biggest reason was likely connected to Boston Beer’s earnings report released Wednesday night. In that report, Boston Beer noted a loss in the fourth quarter no one saw coming. It posted an earnings loss of $0.93, a complete turnaround from analyst expectations of $0.59 per share in earnings. However, Boston Beer did post a revenue win, bringing in $447.5 million against projections of $392.8 million.
Boston Beer’s biggest trouble came from a combination of supply chain issues and the overall production mix, noted Boston Beer CEO David Burwick. Depletions were down 6% on a year-over-year comparison, with Boston Beer’s biggest brands leading the way. Angry Orchard, Truly Hard Seltzer, and Dogfish Head all saw declines. Even the brewer’s flagship brand, Samuel Adams, lost ground. Boston Beer even suggested that the post-COVID-19 reopening proved a problem, as predicting consumer demand in such an environment was a challenge.
Overall, analyst consensus calls Boston Beer stock a Moderate Sell. Further, with an average price target of $314.13, its shares carry 6.23% downside risk.
