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E-Commerce Giving Alcohol Sales a Boost: 4 Stocks to Watch

·4 min read

The pandemic hit the restaurant industry hard that saw sales of food spiraling down. However, not everything suffered. Higher sales at stores and e-commerce have been keeping spirits high for the liquor companies. In fact, online alcohol sales soared by a third in 2020, according to IWSR Drinks Market Analysis.

E-commerce drove alcohol sales like never before in the United States in 2020 and this year too is going to be equally good given that people are more comfortable ordering and buying online.

Online Alcohol Sales Jump

Online alcohol sales jumped a whopping 42% globally to $24 billion in 2020, with the United States driving the bulk of the business, according to IWSR Drinks Market Analysis.

According to the latest data from IWSR Drinks Market Analysis, online alcohol sales soared 80% in the United States to $5.5 billion thanks to the pandemic. The launch of many new e-commerce sites last year further facilitated the smooth sale of alcohol.

Moreover, the International Alliance for Responsible Drinking (IARD), which comprises 12 global beer, wine and spirits companies, partnered with 14 online retailers, e-commerce sites and delivery platforms to facilitate the sale of alcohol online.

Online Alcohol Poised to Grow

A separate report from IWSR mentions that only 1% of total alcohol sales had comefrom e-commerce in 2019. However, given the pace of growth following the coronavirus outbreak, the IWSR predicts that the United States will easily surpass China to become the world’s biggest market for online alcohol sales.

According to Provance, prior to the pandemic, e-commerce had accounted for only 3% to 5% of total retail store alcohol sales. However, it presently accounts for over 30%. In fact, it was almost 45% in places where lockdowns were longer or stricter. 

Another reason for this surge was innovation from many alcohol companies and retailers. As the pandemic gripped the world, online happy hours got extended, allowing people to buy more. Also, several mixologists started sharing recipes on social media that turned many into amateur bartenders at home, thus pushing up sales.

Stocks to Watch

The alcohol market will likely continue to thrive as many have realized the ease of shopping online and drinking at home. It would thus be prudent to invest in these five alcohol stocks with an online presence.

Diageo plc DEO operates in approximately 180 countries and is involved in producing, distilling, brewing, bottling, packaging as well as distributing spirits, wine and beer. 

The company’s expected earnings growth rate for the current year is 16.9%. The Zacks Consensus Estimate for current-year earnings has improved 4% over the past 60 days. The company has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Molson Coors Beverage Company TAP is a global manufacturer and seller of beer and other beverage products. It has an impressive portfolio of owned and partner brands.

The company’s expected earnings growth rate for next year is 6.2%. The Zacks Consensus Estimate for current-year earnings has improved 1.8% over the past 30 days. The company has a Zacks Rank #3 (Hold).

The Boston Beer Company, Inc. SAM is one of the largest craft brewers in the United States. Boston Beer produces beer, malt beverages and cider products at company-owned breweries and under contract. 

The company’s expected earnings growth rate for the current year is 52.1%. The Zacks Consensus Estimate for current-year earnings has improved 1% over the past 60 days. The Boston Beer Company carries a Zacks Rank #3.

AnheuserBusch InBev SANV BUD is a global brewing company with more than 500 iconic brands. The company’s leading position in the majority of its markets and a strong global footprint lends its the advantage of economies of scale and growing multi-country brands. 

The company’s expected earnings growth rate for the current year is 62.3%. The Zacks Consensus Estimate for current-year earnings has improved 3% over the past 30 days. AnheuserBusch InBev SANV has a Zacks Rank #3.

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Molson Coors Beverage Company (TAP) : Free Stock Analysis Report
Diageo plc (DEO) : Free Stock Analysis Report
AnheuserBusch InBev SANV (BUD) : Free Stock Analysis Report
The Boston Beer Company, Inc. (SAM) : Free Stock Analysis Report
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