FR: Boston Beer Keeps It Fresh

Article: Boston Beer Keeps It Fresh

Up next in my “Fool Revisited” series is a piece on one of my favorite companies, and a company that actually helped me land a spot in the Writer’s Development Program in the first place. Boston Beer Co. (NYSE: SAM) – the purveyor of the Sam Adams brand of beer, among others – and has long been a favorite of investors and beer drinkers alike. This will not be the first time that I touch on the company in this series, and even though I don’t drink anymore, it remains one of my favorite companies that I wrote about while working at the Fool.

I believe I wrote this article as part of our sector classes, and I believe it was categorized as a consumer good. I probably chose Boston Beer over some other consumer goods staples because of my affinity for the company, but I’m not 100% sure. These early articles were “practice” for the most part, and our first handful of articles tended to be “takes,” or quick 400-500 word pieces about small bits of investment news. This one was no different.

The article mentions a recent earnings release, but also talks about the company’s just-in-time inventory system – the Freshest Beer Program – which was supposed to ensure fresh product was available on the shelf (hence the title of the article itself). I also pointed out that the company was reliant on its founder Jim Koch, who owns 100% of the Class B shares and all the voting power in the company.

Here’s the ancient tweet announcing my article back in the day:

Had an investor purchased and held onto Boston Beer Co. after the publication of my article – which didn’t really have a direct buy recommend but was generally positive – they would be a fairly happy investor, amd would have slightly outperformed the S&P 500 over the same period. The compound annual growth rate (CAGR) and total growth of Boston Beer outperformed the S&P 500 from article publication (August 25, 2011) through the end of December 2017:

Stock Start Price End Price CAGR Total Growth Value of $10,000
Boston Beer Co. $79.03 $191.10 14.90% 141.81% $24,181
S&P 500 $1,159.27 $2,673.61 14.05% 130.63% $23,063

Source: Yahoo! Finance & author calculation; Stock prices include dividends & stock splits

Boston Beer’s stock, as indicated above, has generally gone up since late 2011, reaching a peak all-time high of $314.52 a share in January 2015, before coming back to earth a bit as the craft beer market reached peak saturation. However, it does remain the second largest producer of “craft brews,” as well as the distribution and production arm for a lot of smaller regional brewers. It is definitely a company that has remained on my radar, but I would probably have to do a bit more heavy research before deciding to invest in it based on past performance.

Until next time…

Disclaimer: I do not own currently own shares in Boston Beer Co., I also have no plans to purchase shares within the next 60 days in any account in which I manage investment funds. You can read a little about my personal investment philosophy here.

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