Coors, Anheuser-Busch Among The 5 Alcohol Stocks Hedge Funds are Getting Drunk On

Page 1 of 2

After identifying the most popular stocks among hedge funds (see our entire Top 10 list here) according to their third quarter 13F filings, we have decided to break down the top five alcoholic beverage companies that hedge funds love. Many of these beverage companies should see a boost from a rise in expected employment that should in turn aid spending on alcoholic beverages. We also like the alcoholic beverage industry given its stability regardless of the economic backdrop. Our list includes the hundreds of hedge funds and prominent investors that are required by the SEC to disclose their public equity holdings quarterly. In descending order, we have outlined the most-loved alcoholic beverage stocks based on the aggregate number of funds owning each.

Molson Coors Brewing Company (NYSE:TAP)

Diageo PLC (NYSE:DEO) had 19 filers owning the stock, putting it in fifth. Diageo has one of the leading premium alcoholic beverages portfolios with brands that include Smirnoff, Johnnie Walker, Guinness, Baileys and J&B—all in all 14 brands. Diageo trades in line with other premium liquor companies at 24x earnings, but has been penetrating the U.S. market better than others. Diageo now receives over 30% of its revenues from North America and the beverage company expects to see 2013 organic sales of 6% thanks in part to restructuring and focusing more on premium brands. While Diageo trades in line with peers on a trailing basis, its forward P/E of 17x may provide investors with a value play.

Molson Coors Brewing Company (NYSE:TAP) was fourth with a total of 23 filers at the end of 3Q. Being the fifth largest brewer in the world, Molson expects to see lagging growth in 2013 as wine and spirits take market share from beers. Despite the lackluster growth prospects, with its diversified product mix—with such products as Coors, Miller and Blue Moon—the argument could be made Molson is a value play. Trading at the cheapest P/E amongst its peers at only 14x earnings, investors might be over discounting the brewer’s growth prospects, including its acquisition of European brewer Starbev.

Beam Inc (NYSE:BEAM) saw a net increase of 5 filers and called 26 filers owners to be the third most popular alcoholic beverage stock owned by hedge funds in 3Q. Beam has quite a robust suite of brands that afford the spirit company a premium 26x trailing earnings valuation. Some of Beam’s top brands include Jim Beam and Maker’s Mark, while its fastest growing brands include Knob Creek bourbon and Effen vodka. Revenues are expected to be up 5% in 2013, driven by its strong U.S. presence, but expected growth in emerging markets will also play a role. Even with potential growth prospects that might be overlooked by investors – where the spirits company trades at 22x forward earnings compared to 26x trailing – Beam also pays a solid dividend yield of 1.5%.

Page 1 of 2

Biotech Insider Alert - $6 Stock To Hit $40

$200 Million Dollar Healthcare Hedge Fund's #1 Best Idea Right Now

The best healthcare hedge fund out there right now is one of the largest shareholders in this biotech stock. The fund returned more than 20% in each of the last 2 years with a virtually fully hedged portfolio, and it's sending out a BUY signal on this biotech stock. Get your FREE REPORT today (retail value of $300)

This is a FREE report from Insider Monkey. Credit Card is NOT required.
Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The Most Wanted Drug Lords

The Oldest Money Managers

The Greatest Directors in the World

Largest Animals in the World

World’s Most Expensive Desserts

Best Selling Comic Books of All Time

A-list Actors who Sabotaged Their Career

Rappers With a College Degree

The Best Jazz Albums of all Time

The Most Influential Jazz Musicians

The World’s Most Famous Photographers

The Best Oscar-Winning Songs

Most Influential Choreographers Ever

Most Expensive Department Stores in the World

The Most Expensive Stolen Paintings in the World

The World’s Most Expensive Teas

Top Oscar Record Holders

The Most Expensive Flowers in the World

Countries With a Booming Film Industry

Most Expensive Cupcakes in the World

Uncommon European Escapes

The Most Stolen Artists in History

Best Travel Destinations in Australia

World’s Most Expensive Musical Instruments

World’s Most Famous Animals

Most Expensive Cakes in the World

Most Expensive Kosher Champagne in the World

Most Expensive Kosher Wine in the World

The Most Surprisingly Dark Fairy Tales

Most Popular Travel Destinations in Asia

The 10 Most Expensive Dresses Ever Worn to the Oscars

World’s Most Visited Art Museums

Best Countries for Photographers to Work in

Best Paid Jobs in the Film Industry

The Most Renowned Recovered Paintings Ever

Child Stars That Turned out Just Fine

Books That Were Banned in the Past Century

World’s Richest Dancers

Best Remedies against Bad Breath

Foods That Improve Your Skin Texture

Best-Selling Children’s Books of all Time

Foods That Boost Your Libido

Best-Selling Books of all Time

The Most Expensive Academy Awards Jewelry in History

Most Expensive Japanese Restaurant In New York City

The Best B-Boy Movies

Most Awesome Hip Hop Documentaries

Foods That Stain Your Teeth

Richest Doctors in the World

The Best Movie Sountracks Ever

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 129% in 2.5 years!! Wondering How?

Download a complete edition of our newsletter for free!