Beer and other beverages giants Molson Coors and Anheuser-Busch InBev reported quarterly results this week. Molson Coors posted mixed results early Tuesday and TAP stock tumbled from a buy zone. Meanwhile, BUD stock surged after beating earnings early Thursday even as the Bud Light boycott continues to weigh on AB InBev.
Modelo Especial brand owner Constellation Brands topped Q1 estimates at the end of June after dethroning Bud Light as the top selling beer in the U.S.
Molson Coors, brewer of Coors Light, Miller Lite, Blue Moon and Vizzy seltzer also saw sizable sales boosts to its brands in recent months.
Coors Light's sales volumes jumped 17.3% for the 12-week period ending July 2, Evercore ISI data shows. Miller Lite sales volume increased 14.3% while Corona Lite's edged up 3%. Bud Light sales volume fell 27.1% during that period.
Molson Coors earnings spiked 49.6% to $1.78 per share adjusted on 11.8% revenue growth to $3.27 billion.
Analysts expected Molson Coors earnings to increase 37.8% to $1.64 per share while sales surged 12.5% to $3.29 billion.
The brewer noted it achieved its best quarterly brand volume trend since the MillerCoors Joint Venture in 2008. Its Coors Light, Miller Lite and Coors Banquet beers all saw double-digit volume growth for the period.
Molson Coors raised its 2023 sales outlook to range from high single-digit growth from its previous guidance of a low single-digit increase. The company expects $1.2 billion in underlying free cash flow, up from its previous forecast of $1 billion.
For 2023, FactSet forecasts earnings increase 21.5% to $4.98 per share on 8.2% sales growth to $11.58 billion.
TAP stock fell 3.3% to 65.12 Thursday, sliding out of a buy zone. Shares fell 4.7% to 66.52 Tuesday following earnings. Molson Coors stock rose slightly the past three months and is up 26.4% so far this year.
On a daily chart, TAP stock fell below the buy zone for a flat base Tuesday after surpassing the 66.67 buy point on June 9. Shares reentered the buy zone Wednesday. That buy zone, which extends 5% beyond the buy point, stretches to 70.
On a weekly chart, TAP stock has a flat base with a 68.13 buy point.
Molson Coors shares pulled back into the buy zone during trade Monday after climbing above its 70 level on July 20.
Bud Light Boycott Weighs On AB InBev
AB InBev reported a 1.3% decline in underlying earnings to 72 cents per share while revenue rose to $15.12 billion. The brewer reported $14.79 billion in revenue for Q2 2022 and noted 7.2% total organic revenue growth for the current period.
Analysts expected AB InBev earnings to fall 6.8% to 68 cents per share while sales increased 3.7% to $15.35 billion.
Total volumes sold dropped by 1.4% for the quarter. Sales to wholesalers fell 15% and sales to retailers fell 14%, underperforming the industry, primarily due to volume declines from Bud Light sales. U.S. revenue fell 10.5% for the quarter.
AB InBev surveyed 170,000 consumers nationwide between April and June and found 80% were favorable or neutral to the Bud Light brand. Meanwhile, the beer industry delivered 2.3% revenue growth for the period, according to Circana data.
For fiscal 2023, AB InBev expects 4% to 8% earnings before interest, taxes, depreciation and amortization growth, while revenue increases ahead of EBITDA on "a healthy combination of volume and price."
Earnings growth slowed the last three quarters while quarterly revenue growth fluctuated in the single digit range from Q1 2022.
Bud Light sales tumbled in the months following its April 1 advertisement with transgender influencer Dylan Mulvaney. Deutsche Bank wrote in a June research note that Bud Light sales may never fully recover.
Bud Light U.S. sales fell 26.5% year over year for the month ending July 15, The Associated Press reported, while Modelo sales increased 13.5% for the period. Modelo held an 8.7% share of the U.S. market, compared to Bud Light's 6.8% for the month.
On July 27, the Wall Street Journal reported Anheuser-Busch laid off 380 employees from its U.S. offices. The job cuts represent about 2% of its 18,000-strong workforce nationwide. It also eliminated corporate and marketing roles at its major U.S. offices. Front-line workers, including brewery and warehouse staff, were not affected. AB InBev did not share a timeline for the layoffs.
AB InBev managed to beat estimates for its Q1 report in May as the Bud Light beer boycott hadn't yet impacted results. But Wall Street expects Anheuser-Busch to feel a bit of a hangover this quarter for its early Thursday results.
BUD Stock
Anheuser-Busch is primarily listed on the Euronext exchange under the ticker ABI. In the U.S., it trades in American Depositary Receipts (ADRs) under the ticker BUD on the New York Stock Exchange.
BUD stock climbed 1.3% to 56.97 Thursday following results. Shares carved 1.1% lower to 56.21 Wednesday to mark three days of declines. Shares traded tightly the past three weeks in a consolidation with a 67.09 buy point as the Bud Light controversy continues. AB InBev shares dipped below their 50-day moving average Wednesday and fell below the 200-day on Monday.
BUD stock tumbled 13.6% over the past three months and fell 5.1% so far this year.
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