Why Boston Beer (SAM) Stock Is Trading Lower Today
What Happened:
Shares of beer company Boston Beer (NYSE:SAM) fell 15.8% in the morning session after the company reported fourth-quarter results with revenue, and EPS missing analysts' expectations. The topline growth continued to decrease in absolute terms, led by a 9% drop in Depletions (due to declines in Truly Hard Seltzer, partially offset by increases in Twisted Tea and growth in Samuel Adams Non-Alcoholic styles and Dogfish Head Canned cocktails) and a 12.2% drop in Shipments. Free cash flow also came in weaker. Looking ahead, guidance was barely convincing as the company expects Depletions and Shipments to be down low single-digit to up low single digit. Overall, this was a mediocre quarter for Boston Beer.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Boston Beer? Access our full analysis report here, it's free.
What is the market telling us:
Boston Beer's shares are somewhat volatile and over the last year have had 5 moves greater than 5%. But moves this big are very rare even for Boston Beer and that is indicating to us that this news had a significant impact on the market's perception of the business.
Boston Beer is down 10.4% since the beginning of the year, and at $304.76 per share it is trading 22.6% below its 52-week high of $393.71 from October 2023. Investors who bought $1,000 worth of Boston Beer's shares 5 years ago would now be looking at an investment worth $973.06.
When a company has more cash than it knows what to do with, buying back its own shares can make a lot of sense–as long as the price is right. Luckily, we’ve found one, a low-priced stock that is gushing free cash flow AND buying back shares. Click here to claim your Special Free Report on a fallen angel growth story that is already recovering from a setback.
