The Boston Beer Company (NYSE:SAM) crashed in pre-market trading after its fourth-quarter results fell short of estimates. The beer company behind the Samuel Adams brand saw its revenues decline by 12% year-over-year to $393.7 million and below consensus estimates of $413.6 million.
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The company’s loss widened in Q4 to -$1.49 per share compared to -$0.93 per share in the same period last year. This loss was wider than analysts’ estimates of -$0.29 per share. More importantly, Boston Beer’s depletions in the fourth quarter declined by 9%. Depletions are defined as the number of beer cases that are sold to retailers. Shipment volumes also dropped year-over-year by 12.2% to 1.5 million barrels.
In FY24, SAM anticipates that its depletions and shipments will likely be down by a low single-digit percentage or up by a low single-digit percentage. The gross margin is likely to be between 43% and 45%, while earnings are projected to be in the range of $7.00 to $11.00 per share.
Is SAM a Good Investment?
Analysts remain bullish about SAM stock with a Moderate Buy consensus rating based on one Buy and two Holds. Over the past year, SAM stock has dropped by more than 10%, and the average SAM price target of $364.67 implies a downside potential of 1.5% at current levels. However, it’s worth noting that estimates will likely change following today’s earnings report.
