Top Beer Stocks for Q1 2022

The beer industry is made up of companies specializing in the production of beer, although many of them produce other alcoholic and non-alcoholic beverages. Some of the big names in the industry include Netherlands-based SABMiller International BV, Belgium-based Anheuser-Busch InBev SA/NV (BUD), and Japan-based Kirin Holdings Co. Ltd. (KNBWY). Demand for beer, a beverage, historically has remained stable throughout economic cycles. As a result, the beer industry is part of the much broader consumer staples sector.

Unlike many past economic downturns, the recession that took place in 2020 was spurred by the health crisis related to COVID-19. The pandemic changed consumer behavior worldwide, sharply lowering beer demand in many regions as bars and restaurants temporarily closed or reopened with reduced capacity. Beer demand has begun to recover amid vaccine rollouts and economic reopening.

Beer stocks, represented by the broad S&P 500 Consumer Staples Sector Index, have underperformed the broader market. The index has provided a total return of 12.1% over the past 12 months, below the 24.3% total return of the Russell 1000 Index. These market performance numbers and the statistics in the tables below are as of Dec. 6, 2021.

Here are the top 3 beer stocks with the best value, the fastest growth, and the most momentum.

These are the beer stocks with the lowest 12-month trailing price-to-earnings (P/E) ratio. Because profits can be returned to shareholders in the form of dividends and buybacks, a low P/E ratio shows you’re paying less for each dollar of profit generated.

^{Source: YCharts}

• Ambev SA: Ambev is a Brazil-based company primarily engaged in the production and distribution of beer. The company also produces and distributes soft drinks and other non-alcoholic beverages including non-carbonated beverages. Ambev reported results on Oct. 28 for Q3 2021, ended Sept. 30, 2021. Profit soared by 57.4% year-over-year (YOY) while net revenue rose 18.5%. The performance was driven by volume gains in Brazil, Central America, the Caribbean, and the company’s Latin America South region.
• United Breweries Co. Inc.: United Breweries, also known as Compañía Cervecerías Unidas, is a Chile-based producer and distributor of a wide range of branded beers. The company also produces wines, spirits, and non-alcoholic beverages such as soft drinks, bottled water, and juices.
• Anheuser-Busch InBev SA/NV:  Anheuser-Busch is a Belgium-based holding company engaged in the manufacture and distribution of alcoholic and non-alcoholic beverages. The company owns a portfolio of more than 400 different beer brands including Budweiser, Corona, and Stella Artois. For Q3 FY 2021 announced Oct. 28, Anheuser-Busch InBev reported plunging profit attributable to equity holders of the company. But the company also reported a 6.1% YOY gain in underlying profit as revenue rose 7.9% on an organic basis.

These are the top beer stocks as ranked by a growth model that scores companies based on a 50/50 weighting of their most recent quarterly YOY percentage revenue growth and their most recent quarterly YOY earnings-per-share (EPS) growth. Both sales and earnings are critical factors in the success of a company. Therefore ranking companies by only one growth metric makes a ranking susceptible to the accounting anomalies of that quarter (such as changes in tax law or restructuring costs) that may make one or the other figure unrepresentative of the business in general. Companies with quarterly EPS or revenue growth of over 2,500% were excluded as outliers.

^{Source: YCharts}

• United Breweries Co. Inc.: See above for company description.
• Ambev SA: See above for company description.
• Molson Coors Beverage Co.: Molson Coors Beverage is a brewing company that produces beer, cider, and related beverages. The company has operations and serves customers worldwide. On Nov. 11 the company declared a quarterly dividend on its Class A and Class B shares of $0.34 per share. The dividend is payable Dec. 15 to shareholders of record as of Dec. 3, 2021.

These are the beer stocks that had the highest total return over the last 12 months.

^{Source: YCharts}

• Diageo PLC: Diageo is a U.K.-based alcoholic beverage company. In addition to beer, the company offers other branded alcoholic beverages, including vodkas, whiskeys, tequilas, and gins. On Nov. 2, the company announced it had broken ground on a $75 million distillery in Yunnan Province, China. The plant will produce China-origin salt-malt whiskey. Construction is expected to begin in 2022. China is the world’s largest beverage alcohol market.
• United Breweries Co. Inc.: See above for company description.
• Constellation Brands Inc.: Constellation Brands is a beverage company that produces and markets beer, wine, and spirits. The company has operations throughout North America and in New Zealand and Italy. It also owns a significant non-majority interest in Canada-based cannabis company Canopy Growth Corp. (CGC).

The comments, opinions and analyses expressed herein are for informational purposes only and should not be considered individual investment advice or recommendations to invest in any security or to adopt any investment strategy. While we believe the information provided herein is reliable, we do not warrant its accuracy or completeness. The views and strategies described on our content may not be suitable for all investors. Because market and economic conditions are subject to rapid change, all comments, opinions, and analyses contained within our content are rendered as of the date of the posting and may change without notice. The material is not intended as a complete analysis of every material fact regarding any country, region, market, industry, investment, or strategy.