Top Beer Stocks for Q3 2022

CCU, ABEV, and STZ are top for value, growth, and performance, respectively

The beer industry is made up of companies specializing in the production of beer, although many of them also produce other alcoholic and nonalcoholic beverages. Some of the big names in the industry include Netherlands-based SABMiller International B.V.—which is now part of fellow big name Belgium-based Anheuser-Busch InBev S.A./N.V. — as well as Japan-based Kirin Holdings Co. Ltd. Demand for beer historically has remained stable throughout economic cycles. As a result, the beer industry is part of the much broader consumer staples sector.

According to a report by Technavio, the impact on the beer market growth has been neutral amid the economic shock from the COVID-19 pandemic. The market in 2022 is seeing increasing demand for premium beers, which continue to drive market growth. Also, several major beer companies have succeeded in raising prices even as consumes are squeezed by inflation. The beer industry is expected to continue growing at a steady compound annual growth rate (CAGR) of 2.45% between 2020 and through 2025.

Beer stocks, represented by the broad S&P 500 Consumer Staples Sector Index, have outperformed the broader market. The index has provided a total return of 9.2% over the past 12 months, above the -2.7% total return of the Russell 1000 Index. Note that the consumer staples sector is much broader than beer stocks as a category, so the sector's performance compared with beer stocks specifically may diverge. These market performance numbers and the statistics in the tables below are as of May 30, 2022.

Here are the top three beer stocks with the best value, the fastest growth, and the best performance.

Best Value Beer Stocks

These are the beer stocks with the lowest 12-month trailing price-to-earnings (P/E) ratio. Because profits can be returned to shareholders in the form of dividends and buybacks, a low P/E ratio shows that you’re paying less for each dollar of profit generated.

Best Value Beer Stocks
  Price ($) Market Capitalization (Market Cap) ($B) 12-Month Trailing P/E Ratio
United Breweries Co. Inc. (CCU) 14.01 2.6 10.3
Molson Coors Beverage Co. (TAP) 55.84 12.1 11.3
Carlsberg A/S (CABGY) 25.62 18.1 17.2

Source: YCharts

  • United Breweries Co. Inc.: United Breweries, also known as Compañía Cervecerías Unidas, is a Chile-based producer and distributor of a wide range of branded beers. The company also produces wines, spirits, and nonalcoholic beverages such as soft drinks, bottled water, and juices.
  • Molson Coors Beverage Co.: Molson Coors Beverage makes and sells beers globally, including in the U.S., Europe, and Asia. Besides its multiple beer brands, Molson Coors' portfolio includes canned wine, sparkling cocktails, and cider. On May 3 Molson Coors announced results for Q1 2022. Net income attributable to Molson Coors Brewing Company increased by 80.1% as net sales climbed 16.7% year-over-year (YOY). The company attributed the growth to positive net pricing, a favorable sales mix, and improving volumes.
  • Carlsberg A/S: Carlsberg A/S is a Denmark-based brewing company. It produces, markets, and sells beer and soft drinks primarily across Europe and in Asia. On April 28, Carlsberg announced a Q2 2022 share buyback program amounting to DKK1 billion ($143.2 million).

Fastest Growing Beer Stocks

These are the top beer stocks as ranked by a growth model that scores companies based on a 50/50 weighting of their most recent quarterly YOY percentage revenue growth and most recent quarterly YOY earnings-per-share (EPS) growth. Both sales and earnings are critical factors in the success of a company. Therefore, ranking companies by only one growth metric makes a ranking susceptible to the accounting anomalies of that quarter (such as changes in tax law or restructuring costs) that may make one figure or the other unrepresentative of the business in general. Companies with quarterly EPS or revenue growth of more than 2,500% were excluded as outliers.

Fastest Growing Beer Stocks
  Price ($) Market Cap ($B) EPS Growth (%) Revenue Growth (%)
Molson Coors Beverage Co. (TAP) 55.84 12.1 79.5 16.7
Ambev S.A. (ABEV) 2.96 46.6 35.9 15.7
Constellation Brands Inc. (STZ) 245.47 45.7 6.2 7.7

Source: YCharts

  • Molson Coors Beverage Co.: See above for company description.
  • Ambev S.A.: Ambev is a Brazil-based company primarily engaged in the production and distribution of beer. The company also produces and distributes soft drinks and other nonalcoholic beverages, including non-carbonated beverages. In its earnings release for Q1 2022, issued on May 5, the company reported 29.1% YOY improvement in profits on solid net revenue growth. Ambev said that growth was strong across nearly all of its markets, with the exception of Canada.
  • Constellation Brands Inc.: Constellation Brands produces and sells beer, wine, and spirits, and has operations in the U.S. and in Mexico, New Zealand, and Italy. In mid-April, Constellation announced it would enter the ready-to-drink boxed wine cocktail market with the launch of Next Round Cocktails. The pre-mixed cocktails market is estimated at more than $696 million and the premium boxed wine market is approaching $1 billion.

Beer Stocks with the Best Performance

These are the beer stocks that had the best returns or smallest declines in total return over the past 12 months out of the companies we looked at.

Beer Stocks with the Best Performance
  Price ($) Market Cap ($B) 12-Month Trailing Total Return (%)
Constellation Brands Inc. (STZ) 245.47 45.7 3.8
Diageo PLC (DEO) 186.97 107.1 -1.2
Molson Coors Beverage Co. (TAP) 55.84 12.1 -2.1
Russell 1000 Index N/A N/A -2.7
S&P 500 Consumer Staples Sector Index N/A N/A 9.2

Source: YCharts

  • Constellation Brands Inc.: See above for company description.
  • Diageo PLC: Diageo is a U.K.-based alcoholic beverage company. In addition to beer, the company sells other branded alcoholic beverages, including vodkas, whiskeys, tequilas, and gins. Diageo reported on May 10 that it had sold its Picon flavored liqueur brand to Campari Group. The aggregate consideration of the transaction was roughly 119 million euros ($127.3 million).
  • Molson Coors Beverage Co.: See above for company description.

The comments, opinions, and analyses expressed herein are for informational purposes only and should not be considered individual investment advice or recommendations to invest in any security or adopt any investment strategy. While we believe the information provided herein is reliable, we do not warrant its accuracy or completeness. The views and strategies described in our content may not be suitable for all investors. Because market and economic conditions are subject to rapid change, all comments, opinions, and analyses contained within our content are rendered as of the date of the posting and may change without notice. The material is not intended as a complete analysis of every material fact regarding any country, region, market, industry, investment, or strategy.

Article Sources
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  1. Wall Street Journal. "Beer Shows Pricing Muscle Despite Its Underdog Status."

  2. Cision PRNewswire. "USD 88.70 Bn growth in Beer Market | Increasing demand for premium beers to boost growth | Technavio."

  3. Technavio. "Beer Market by Distribution Channel and Geography - Forecast and Analysis 2021-2025."

  4. YCharts. “Financial Data.”

  5. Molson Coors Beverage Co. "Molson Coors Beverage Company Reports 2022 First Quarter Results."

  6. Carlsberg A/S. "Q1 2022 Trading Statement."

  7. Ambev S.A. "AMBEV REPORTS 2022 FIRST QUARTER RESULTS," Pages 1-2.

  8. Constellation Brands Inc. "Constellation Brands Enters the Ready-to-Drink Boxed Wine Cocktail Category with the Launch of Next Round Cocktails™, Artfully Designed to Serve a Crowd in Style."

  9. Diageo PLC. "Diageo sells Picon brand to Campari Group."

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