SAM Stock: Why It Is Trading Lower Today

By Amit Chowdhry ● Sep 9, 2021
  • The stock price of The Boston Beer Company, Inc. (NYSE: SAM) dropped over 10% pre-market. This is why it happened.

The stock price of The Boston Beer Company, Inc. (NYSE: SAM) dropped over 10% pre-market. Investors are responding negatively to the company issuing a statement that it is continuing to experience decelerating growth trends. 

Industry reports estimated that the full year 2021 volume for the hard seltzer market retail sales will have over 100 million fewer cases than the volumes estimated in May 2021 and over 30 million fewer cases than the volumes estimated in July 2021. And while the demand for the company’s hard seltzer products continues to grow at faster than category rates in measured off-premise channels, they believe there will be continuing uncertainty about hard seltzer demand trends for the remainder of 2021.

As a result of this uncertainty and its impact on our volume trends, The Boston Beer Company is withdrawing its 2021 financial guidance issued on July 22, 2021. And the company now expects to incur hard seltzer-related inventory write-offs, shortfall fees payable to 3rd party brewers, and other costs that will be expensed during the remainder of fiscal 2021. As a result, The Boston Beer Company currently expects full year 2021 earnings per diluted share will fall below the previously-reported estimate of between $18.00 and $22.00, excluding the impact of ASU 2016-09.

The Boston Beer Company will continue to review its volume projections and the related impact on its business and full year financial results in light of evolving market conditions and will update its progress on its next scheduled earnings call scheduled for October 21, 2021.

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.