As the Q2 earnings season wraps, let’s dig into this quarter’s best and worst performers in the beverages and alcohol industry, including Zevia PBC (NYSE:ZVIA) and its peers.
These companies' performance is influenced by brand strength, marketing strategies, and shifts in consumer preferences. Changing consumption patterns are particularly relevant and can be seen in the explosion of alcoholic craft beer drinks or the steady decline of non-alcoholic sugary sodas. Companies that spend on innovation to meet consumers where they are with regards to trends can reap huge demand benefits while those who ignore trends can see stagnant volumes. Finally, with the advent of the social media, the cost of starting a brand from scratch is much lower, meaning that new entrants can chip away at the market shares of established players.
The 12 beverages and alcohol stocks we track reported a mixed Q2. As a group, revenues were in line with analysts’ consensus estimates while next quarter’s revenue guidance was 13.1% below.
Stocks, especially growth stocks with cash flows further into the future, had a good end of 2023. On the other hand, this year has seen more volatile stock market swings due to mixed inflation data. However, beverages and alcohol stocks have held steady amidst all this with share prices up 4.3% on average since the latest earnings results.
Zevia PBC (NYSE:ZVIA) With a primary focus on soda but also a presence in energy drinks and teas, Zevia (NYSE:ZVIA) is a better-for-you beverage company.
Zevia PBC reported revenues of $40.43 million, down 4.3% year on year. This print exceeded analysts’ expectations by 3.8%. Despite the top-line beat, it was still a weaker quarter for the company with a miss of analysts’ gross margin estimates and full-year revenue guidance missing analysts’ expectations.
“We delivered net sales above our guidance in the second quarter, and scan sales reflect accelerating retail growth trends through the quarter and into July,” said Amy Taylor, President and Chief Executive Officer.
Zevia PBC achieved the highest full-year guidance raise of the whole group. Unsurprisingly, the stock is up 18.9% since reporting and currently trades at $1.07.
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Best Q2: Celsius (NASDAQ:CELH) With its proprietary MetaPlus formula as the basis for key products, Celsius (NASDAQ:CELH) offers energy drinks that feature natural ingredients to help in fitness and weight management.
Celsius reported revenues of $402 million, up 23.4% year on year, outperforming analysts’ expectations by 2.4%. It was a very strong quarter for the company with a solid beat of analysts’ gross margin estimates and a decent beat of analysts’ earnings estimates.
Celsius achieved the fastest revenue growth among its peers. However, the results were likely priced into the stock as it’s traded sideways since reporting. Shares currently sit at $41.75.
Boston Beer (NYSE:NYSE:SAM) Known for its flavorful beverages challenging the status quo, Boston Beer (NYSE:SAM) is a pioneer in craft brewing and a symbol of American innovation in the alcoholic beverage industry.
Boston Beer reported revenues of $579.1 million, down 4% year on year, falling short of analysts’ expectations by 3.1%. It was a weak quarter for the company with a miss of analysts’ earnings and gross margin estimates.
The stock is flat since the results and currently trades at $271.67.
MGP Ingredients (NASDAQ:MGPI) Headquartered in Atchison, Kansas, MGP Ingredients (NASDAQGS:MGPI) is a leading supplier of high-quality ingredients to the food and beverage industry
MGP Ingredients reported revenues of $190.8 million, down 8.7% year on year, in line with analysts’ expectations. Revenue aside, it was a decent quarter for the company with a solid beat of analysts’ gross margin estimates but full-year revenue guidance missing analysts’ expectations.
MGP Ingredients had the slowest revenue growth among its peers. The stock is up 7.6% since reporting and currently trades at $87.63.
PepsiCo (NASDAQ:PEP) With a history that goes back more than a century, PepsiCo (NASDAQ:PEP) is a household name in food and beverages today and best known for its flagship soda.
PepsiCo reported revenues of $22.5 billion, flat year on year, in line with analysts’ expectations. Overall, it was a slower quarter for the company with a miss of analysts’ organic revenue growth estimates and underwhelming earnings guidance for the full year.
The stock is up 5.7% since reporting and currently trades at $172.97.
This content was originally published on Stock Story
