The beverage industry is experiencing a surge in innovation, and its stocks are emerging with surprising growth stories. Traditional players and emerging brands alike are adapting to evolving consumer tastes, from craft and premium beverages to functional and health-oriented drinks. Such a dynamic shift is fueling growth and offering investors fresh opportunities.
Thus, investors could consider watching three fundamentally sound beverage stocks: Heineken N.V. (HEINY), Molson Coors Beverage Company (TAP), and Coca-Cola Consolidated, Inc. (COKE).
The beverage industry is a mature market, but changing consumer preferences are transforming its market. As consumers seek healthier, more sustainable, and unique flavor experiences, beverage companies are launching new products to meet their demands.
In December 2024, consumer data shows that beverages for gym and daily routines still top the charts. Looking ahead, products offering targeted health benefits, such as hydration, stress relief, and mental focus, are set to be more popular in 2025.
Cutting-edge production techniques and digital marketing strategies to reach a broader audience are also drivers for capturing a larger market share. By leveraging advanced analytics and e-commerce platforms, these firms are able to fine-tune their offerings and create personalized experiences for consumers. Moreover, the global beverages market is set to reach $380.36 billion by 2029, growing at a CAGR of 8.3%.
Given these positive market trends, let’s look at the fundamentals of the three Beverages stocks, starting with the third pick.
Stock #3: Heineken N.V. (HEINY)
Headquartered in Amsterdam, the Netherlands, HEINY brews and sells beer and cider internationally. The company offers its beers under the brand names like Heineken, Heineken Light, Orchard Thieves, Orchard Thieves Light, Birra Moretti, Coors, Murphy's and Beamish Stouts, Desperados, Tiger, Sol, and Foster's. It provides soft drinks and water as well.
For the fiscal year of 2024, which ended on December 31, HEINY's revenue amounted to €29.82 billion ($37.51 billion), while the operating income stood at €3.52 billion ($3.67 billion), up 8.9% year-over-year. Its net profit (beia) amounted to €2.74 billion ($2.86 billion), representing an increase of 4.1% from the last year’s period. Also, the company’s EBITDA (beia) for the quarter increased 2.2% year-over-year to €6.69 billion ($6.97 billion).
Analysts expect HEINY’s revenue for the fiscal year (ending December 2025) to be $32.32 billion and its EPS to increase significantly to $5.68. For the fiscal year 2026, its revenue is expected to increase 3.9% year-over-year to $33.61 billion, while its EPS is forecasted to settle at $6.75, indicating an 18.8% improvement over the prior year.
Moreover, HEINY’s revenue has grown at CAGRs of 10.8% and 4.5% over the past three and five years, respectively. In addition, its EBIT increased at 7.7% CAGR over the past three years.
Over the past month, the stock has surged 19.7%, closing the last trading session at $40.74.
HEINY’s stance is apparent in its POWR Ratings. The stock has a B grade for Growth and Stability. The POWR Ratings are calculated by considering 118 different factors, each weighted to an optimal degree.
Among the 31 stocks in the B-rated Beverages industry, it is ranked #14. Click here to see the additional HEINY ratings (Value, Momentum, Sentiment, and Quality).
Stock #2: Molson Coors Beverage Company (TAP)
TAP manufactures, markets, and sells beer and other malt beverage products under various brands globally. The company offers flavored malt beverages, including hard seltzers, craft, and ready-to-drink beverages.
On January 30, TAP announced a strategic partnership with Fevertree Drinks plc, the world’s leading supplier of premium carbonated drinks and mixers, to expand its U.S. non-alcoholic portfolio. Under this partnership, TAP will assume exclusive commercialization rights to Fever-Tree’s award-winning lineup of tonics, ginger beers, cocktail mixers, and more in the United States, expanding its variety to reach more consumers.
TAP’s net sales for the fiscal fourth quarter ended December 31, 2024, came in at $2.74 billion. The company reported operating income of $388.1 million, indicating a 94.7% growth from the prior-year quarter. In addition, its underlying net income stood at $268.6 million and $1.30 per share, reflecting increases of 4.4% and 9.2% year-over-year.
Street expects TAP’s revenue for the fiscal second quarter (ending June 2025) to decline marginally year-over-year to $3.24 billion. Its EPS for the same period is expected to register a 6.6% growth from the prior year, settling at $2.05. In addition, it surpassed the consensus EPS estimates in each of the trailing four quarters, which is promising.
Over the past three and five years, TAP’s net income grew at CAGRs of 3.7% and 35.9%, respectively, while its EBIT grew at 5.4% CAGR over the past three years.
TAP shares have surged 11.3% over the past six months and 8.9% over the past month to close the last trading session at $60.14.
TAP’s fundamentals are reflected in its POWR Ratings. The stock has a B grade for Value and Quality. It is ranked #13 out of 31 stocks in the same B-rated industry.
Beyond what is stated above, we’ve also rated TAP for Growth, Momentum, Stability, and Sentiment. Get all TAP’s ratings here.
Stock #1: Coca-Cola Consolidated, Inc. (COKE)
COKE manufactures and distributes a wide range of nonalcoholic beverages that include sparkling drinks, energy drinks, water, coffee, tea, and juices. It serves diverse end-users, such as retailers, restaurants, schools, amusement parks, and recreational facilities, as well as through vending machine outlets.
In the third quarter (ended September 27, 2024), COKE’s net sales increased 3.1% year-over-year to $1.77 billion. The company reported a gross profit of $698.03 million, indicating a 5.5% growth from the prior year’s quarter. Its income from operations grew 5% from the same period last year to $227.05 million. COKE’s net income came in at $115.62 million or $13.18 per share, up 25.6% and 34.5% year-over-year, respectively.
COKE’s earnings from continuing operations have grown at CAGRs of 30.3% and 248.7% over the past three and five years, respectively. Likewise, the company’s levered FCF has increased at a CAGR of 22.1% over the past five years.
Shares of COKE gained 66.6% over the past year and 50.5% over the past nine months to close the last trading session at $1,409.72.
COKE’s bright prospects are reflected in its POWR Ratings. The stock has an overall rating of B, which translates to a Buy in our proprietary rating system.
It also has a B grade for Stability, Sentiment, and Quality. Within the same Beverages industry, it is ranked #9. Click here to see COKE’s ratings for Growth, Value, and Momentum.
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HEINY shares were trading at $40.73 per share on Thursday afternoon, down $0.01 (-0.02%). Year-to-date, HEINY has gained 15.12%, versus a 4.05% rise in the benchmark S&P 500 index during the same period.
About the Author: ShreyaRathi
