This article looks at the 10 best beverage stocks to buy according to analysts.
Consumer behavior plays a key role in shaping any industry, and the beverage sector is no exception. The industry is witnessing a noticeable shift in drinking habits, with Americans becoming more conscious about what they consume due to health considerations. There has been an increase in demand for low and no-alcohol beverages, and several companies are jumping on the bandwagon and producing drinks with all of the taste but those that are low on or without alcohol.
READ ALSO: 8 Best Beverage Dividend Stocks To Buy According to Hedge Funds and 50 Drunkest Counties in Every State in the US.
According to a consumer sentiment survey commissioned by NCSolutions (NCS) in early 2024, around 61% of Generation Z intended to cut down on alcohol consumption, representing a 53% year-over-year increase in the share of respondents who said they planned on drinking less alcohol. A little over one-third of the demographic cohort participants said they were interested in trying a beverage that aligns with a sober curious lifestyle.
On the other hand, 49% of millennials responded by saying they plan to reduce their alcohol consumption, an increase of 26% from the survey findings in 2023. Overall, 41% of Americans hoped to drink less in 2024, compared to 34% the year before. These results reflect the gaining popularity of the sober curious movement in the United States, driven by strong interest from the younger generation.
According to Fortune Business Insights, the non-alcoholic beverages market size in the United States was valued at $161 billion in 2023. It is projected to increase to nearly $226 billion by 2030, at a CAGR of 4.91%. The rising popularity of refreshment drinks and mocktails, coupled with innovative marketing and branding strategies of beverage manufacturers are propelling growth in the non-alcoholic beverage market.
Despite consumer behavior shifts within the beverage industry, the overall outlook for the sector is promising. According to a report by Research and Markets, its market size is expected to reach $2.29 trillion by 2030. The industry continues to see robust demand amid rising disposable incomes globally and rapid expansion in developing economies.
However, Trump’s announcement of a 25% tariff on all imported steel and aluminum is a looming threat to the American beverage industry, as about 75% of all new beverage launches in North America now appear in aluminum cans. The tariffs are expected to increase input costs and lead to a rise in prices for end consumers, which could adversely impact struggling categories in the beverage industry.
With that said, let’s now head over to the list of the best beverage stocks to buy according to analysts.
A close-up of bottles of whisky and other alcoholic beverages from a winery.
Methodology
For this article, we sifted through screeners to identify stocks in the beverage industry that had an average share price upside potential of 20% or higher as of the close of day on February 20, 2025. Then we listed the top 10 stocks in ascending order of their average share price upside potential. We have only considered stocks that had at least three analyst ratings.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10 Best Beverage Stocks to Buy According to Analysts
10. Fomento Económico Mexicano, S.A.B. de C.V. (NYSE:FMX)
Average Share Price Upside Potential as of February 20: 20.23%
Fomento Económico Mexicano, S.A.B. de C.V. (NYSE:FMX) produces and distributes Coca-Cola trademark beverages in different markets of Latin America. It also operates in the retail industry through small-box chain stores under the OXXO brand.
Despite a soft consumer environment, especially in Mexico, the company reported encouraging financial results during the third quarter of fiscal 2024, with most business segments reporting revenue growth and margin expansion. Fomento Económico Mexicano, S.A.B. de C.V. (NYSE:FMX) has also announced several divestments in recent months as part of its FEMSA Forward strategy, which was laid out in 2023 to drive long-term value.
In October, Fomento Económico Mexicano, S.A.B. de C.V. (NYSE:FMX) entered into a definitive agreement with AMMI to divest its plastics solutions operations for 3,165 million pesos on a cash-free, debt-free basis. The transaction was completed on January 3. In November, the company’s refrigeration and food service equipment operations, Imbera and Torrey, were acquired by Mill Point Capital LLC for 8,000 million pesos.
Fomento Económico Mexicano, S.A.B. de C.V. (NYSE:FMX)’s bottling business remains solid and is steadily growing. The divestiture of non-essential businesses will allow the company to continue shareholder returns. OXXO’s robust expansion plans for the United States have also set FMX well for future growth.
Wall Street analysts are bullish on the stock, with a consensus Buy rating and an average share price upside potential exceeding 20%, making Fomento Económico Mexicano, S.A.B. de C.V. (NYSE:FMX) one of the best beverage stocks to buy according to analysts.
9. Anheuser-Busch InBev SA/NV (NYSE:BUD)
Average Share Price Upside Potential as of February 20: 20.41%
Anheuser-Busch InBev SA/NV (NYSE:BUD) is a Belgium-based company engaged in beer manufacturing. Its brand portfolio includes notable names like Budweiser, Bud Light, Corona, and Stella Artois. With nearly 27% of the share of global beer production in 2023, it is the largest beer company in the world.
In January, the company inked a brewing agreement with Pabst Brewing Company, marking the integration of a former competitor into its supply chain. The move is also expected to boost Anheuser-Busch InBev SA/NV (NYSE:BUD)’s beer volumes in the U.S. Beginning in the first quarter of 2025, several of Pabst’s iconic brands are set to be brewed at AB InBev facilities after the former’s 20-year partnership with Molson Coors ended in December 2024.
Anheuser-Busch InBev SA/NV (NYSE:BUD) benefits immensely from its wide global presence. During the third quarter of fiscal 2024, it reported a 50% volume increase and 60% revenue growth in its markets. The company is also making gains in the non-alcoholic beer category and has expanded its market share in over 60% of the markets, driven by strength in Corona Cero sales.
Anheuser-Busch InBev SA/NV (NYSE:BUD) is committed to return value to shareholders. In October last year, the Board approved a $2 billion share repurchase program to be executed within the next 12 months. The company was also recently listed by Insider Monkey among the 13 Best Foreign Dividend Stocks To Buy According to Analysts.
Wall Street analysts are bullish on the stock, with a consensus Buy rating and an average share price upside potential of over 20%. Investor sentiment also continues to improve. According to Insider Monkey’s database for Q4 2024, 31 hedge funds held a stake in Anheuser-Busch InBev SA/NV (NYSE:BUD), up from 26 at the end of the third quarter.
8. Primo Brands Corporation (NYSE:PRMB)
Average Share Price Upside Potential as of February 20: 20.68%
Primo Brands Corporation (NYSE:PRMB) is a North American beverage company focused on healthy hydration. It was formed in November 2024 following the merger of Primo Water and BlueTriton Brands. The company has a broad portfolio of branded beverages distributed across 200,000 retail outlets. It also offers water dispensers, filtration appliances, self-service water refill stations, and direct delivery of reusable bottles.
On February 20, Primo Brands Corporation (NYSE:PRMB) declared its financial results for 2024. It reported combined net sales of $6.81 billion, up 5.4% from last year, driven by volume growth of 3.4%. Combined adjusted EBITDA grew 19.5% compared to fiscal 2023 to reach $1.353 billion, and the adjusted EBITDA margin stood at 19.9%.
Primo Brands Corporation (NYSE:PRMB) also provided an outlook for fiscal 2025. It expects net sales growth of between 3% and 5%, with $7 billion at the midpoint. Adjusted EBITDA is anticipated to be between $1.6 billion and $1.628 billion, with an EBITDA margin of 23.1% at the midpoint. The company also expects to capture $200 million in cost synergies during the year.
The board of directors has also authorized a quarterly dividend of 10 cents per share, which is an 11% increase year-over-year, and reflects the company’s commitment to shareholder returns. Wall Street analysts are bullish on Primo Brands Corporation (NYSE:PRMB) with a consensus Strong Buy rating and an average share price upside potential of nearly 21%, making it one of the best beverage stocks to buy according to analysts.
7. Coca-Cola FEMSA, S.A.B. de C.V. (NYSE:KOF)
Average Share Price Upside Potential as of February 20: 23.32%
Coca-Cola FEMSA, S.A.B. de C.V. (NYSE:KOF) is a franchise bottler of Coca-Cola trademark beverages, headquartered in Mexico City. The company produces and markets Coca-Cola products in various countries of Latin America. It also offers other sparkling beverages, and non-carbonated drinks and distributes beer products in different parts of the region.
During its Q4 2024 earnings call on February 21, Coca-Cola FEMSA, S.A.B. de C.V. (NYSE:KOF) announced consolidated results for fiscal 2024. It reported a revenue of 279,793 million pesos, up 14.2% year-over-year due to volume growth and revenue management initiatives. Net income for the year stood at 23,729 million pesos, reflecting a 21.5% increase from last year, driven primarily by operating income growth.
Coca-Cola FEMSA, S.A.B. de C.V. (NYSE:KOF) continues to see growth momentum in its core business, which is helping it increase its customer base. The company is also digitizing several of its operations, especially through its Juntos+ software application, which is being deployed with AI capabilities and now has approximately 1.3 million active users in Latin America.
The company is optimistic about fiscal 2025 given the opportunities across the markets. Coca-Cola FEMSA, S.A.B. de C.V. (NYSE:KOF) is also spending heavily on capital expenditure to expand its production and distribution capacity. It is one of the best beverage stocks to buy according to analysts, with a consensus Strong Buy rating and an average share price upside potential of over 23%.
6. The Boston Beer Company, Inc. (NYSE:SAM)
Average Share Price Upside Potential as of February 20: 33.74%
The Boston Beer Company, Inc. (NYSE:SAM) sells alcoholic beverages across the United States and selected international markets. The company offers beers, flavored malt beverages, hard cider, hard seltzer, and hard tea. It is one of the best beverage stocks to buy according to analysts, with an average share price upside potential of over 33%.
The company is following an aggressive diversification strategy amid changing consumer preferences. Last year, it launched Samuel Adams American Light, a refreshing light craft lager for everyday drinking occasions. The beverage has an ABV of 4.2% and is designed to be an easy-drinking beer without compromising on flavor.
The Boston Beer Company, Inc. (NYSE:SAM) has also forayed into cannabis beverages. It recently unveiled Emerald Hour, a line of non-alcoholic cannabis cocktails. The drink will begin with two cocktail styles: Cranberry-Citrus and Ginger-Lime. Emerald Hour, which is made with cannabis extracts and cocktail ingredients offers a great alternative for consumers looking for a stronger and booze-free happy hour.
The company is also optimizing its supply chain. As part of these efforts, on December 20, The Boston Beer Company, Inc. (NYSE:SAM) amended its production agreement with Rauch North America Inc. to better align its future capacity requirements. While the move is expected to cost $26 million in pre-tax contract settlement expenses and impact diluted EPS for Q4 FY24, it will help in increasing production facility and secure more favorable termination rights.
According to Insider Monkey’s database for Q4 2024, 29 hedge funds held a stake in The Boston Beer Company, Inc. (NYSE:SAM), up from 28 at the end of the third quarter. Savoir Faire Capital Management was the largest investor in the company, with holdings valued at approximately $4.2 million, as of December 31, 2024.
5. SunOpta Inc. (NASDAQ:STKL)
Average Share Price Upside Potential as of February 20: 34.75%
SunOpta Inc. (NASDAQ:STKL) manufactures plant-based food and beverage products in the United States and internationally, which are sold through retail and food service channels. The company utilizes almonds, oats, soy, rice, coconut, and other bases to produce its beverages.
In October last year, the company announced plans to expand Dream Oatmilk Barista to another 6,700 stores across North America in collaboration with a major coffee chain. The move will help in further increasing the distribution of the product in the region. It will also significantly increase the utilization of its oat extraction and manufacturing facilities.
In June 2024, SunOpta Inc. (NASDAQ:STKL) invested $26 million in the expansion of its plant-based beverage processing facility in Modesto, California. This was the second-largest project in the history of the company. It will allow SunOpta to increase its annual oat milk output by 60% and meet ongoing strong customer demand. With the plant-based milk market projected to grow in size from $20 billion in 2024 to over $45 billion by 2034, SunOpta Inc. (NASDAQ:STKL) is well-positioned to capitalize on rising demand for plant-based milk and oat-based products.
During its Q3 2024 earnings call, the company reported a 15.5% increase in revenue from operations, driven by a 20.6% volume growth. Wall Street analysts are bullish on the stock, with a consensus Strong Buy rating and an average share price upside potential of nearly 35%.
According to Insider Monkey’s database for Q4 2024, 27 hedge funds held a stake in SunOpta Inc. (NASDAQ:STKL), an improvement from 18 at the end of the third quarter. Oaktree Capital Management is the largest investor in the company, with a stake value of over $159 million, as of December 31, 2024.
4. Constellation Brands, Inc. (NYSE:STZ)
Average Share Price Upside Potential as of February 20: 45.38%
Constellation Brands, Inc. (NYSE:STZ) is engaged in the production, marketing, and sale of beer, wine, and spirits. The company has operations in the U.S., Mexico, Italy, and New Zealand. It is one of the best beverage stocks to buy according to analysts.
On February 20, the company announced acquiring a minority stake in Hiyo, a local non-alcoholic beverage brand, that caters to health-conscious consumers favoring moderation. This strategic investment by Constellation Brands, Inc. (NYSE:STZ) reflects the ongoing shift in consumer preferences amid a growing trend to seek flavorful alternatives to alcoholic beverages.
On January 10, Constellation Brands, Inc. (NYSE:STZ) declared financial results for the third quarter of fiscal 2025. It reported net sales of $2.46 billion, missing estimates of $2.53 billion and remaining largely flat compared to the prior year’s period. Its earnings per share of $3.25 also fell short of estimates by 6 cents.
Weak consumer spending pulled third-quarter results below expectations. According to a report in Reuters, lower-income Americans are increasingly shifting toward cheaper beer alternatives, which are hurting sales at Constellation Brands, Inc. (NYSE:STZ). As a result, the company has cut annual sales and profits forecast for the full year. It now expects net sales growth of 2% to 5%, and operating income growth of 6% to 9%.
Despite a challenging market environment, Constellation Brands, Inc. (NYSE:STZ) executed $219 million of share repurchases during the quarter, bringing total year-to-date share repurchases to nearly $670 million. On January 9, the company also declared a cash dividend of $1.01 per share, reiterating its commitment to strong shareholder returns.
Wall Street analysts maintain a consensus Buy rating for the stock and anticipate a 45% uptick, on average, in its share price – hinting at a recovery from the plummeting after the Q3 earnings call. Investor sentiment continues to remain strong. According to Insider Monkey’s database for Q4 2024, 51 hedge funds held a stake in Constellation Brands, Inc. (NYSE:STZ), up from 36 at the end of the third quarter.
3. Brown-Forman Corporation (NYSE:BF-B)
Average Share Price Upside Potential as of February 20: 46.22%
Brown-Forman Corporation (NYSE:BF-B) is engaged in the manufacturing and distribution of various alcoholic beverages, including wine, whiskey, vodka, scotch, tequila, and liqueur. Its brands include Jack Daniel, Old Forester, Woodford Reserve, and several others.
Last month, the company announced it would lay off 12% of its global workforce as part of a restructuring plan to reduce costs amid changing consumer preferences. The Jack Daniel’s maker has been struggling with high input costs, which has led to an increase in price for its whiskeys. The high cost of living environment is also forcing consumers to shift to cheaper alternatives.
Brown-Forman Corporation (NYSE:BF-B) will also shut its barrel-making facility in Louisville by April 25. The closure will impact around 210 employees. Moving ahead, the company will source barrels externally from an unnamed supplier. The restructuring plan is expected to generate between $70 million and $80 million in annualized savings for the company.
Analysts believe that like most other companies in the spirits sector, Brown-Forman Corporation (NYSE:BF-B) is experiencing a ‘COVID hangover’. Consumers stocked up on alcoholic beverages during the pandemic, resulting in a temporary surge in sales. The demand has slowed down with the situation returning to normal, resulting in flat or negative growth across categories.
Despite Brown-Forman Corporation (NYSE:BF-B)’s share price reaching a 10-year low in January, analysts believe the company is well-placed for long-term growth with global incomes rising and more people across the world gaining access to premium products. While Wall Street analysts have a consensus Hold rating for the stock, they project a 46% increase in BF-B’s share price, making it one of the best beverage stocks to buy.
2. Celsius Holdings, Inc. (NASDAQ:CELH)
Average Share Price Upside Potential as of February 20: 90.64%
Celsius Holdings, Inc. (NASDAQ:CELH) is a global beverage company engaged in the development and distribution of functional energy drinks and supplements. Its flagship asset, CELSIUS, is focused on accelerating metabolism and burning fat. The company distributes its products through a network of retailers, drug stores, health clubs, gyms, and e-commerce websites.
The company recently reported robust financial results for fiscal 2024. It generated a record revenue of $1.36 billion, up 3% from last year. This was driven by strong North American and international business growth and increased promotional and incentive programs. Gross profit rose 7% year-over-year to $680.2 million. Income for the year was $145 million, down 36% due to the timing of certain distributor orders.
On February 20, Celsius Holdings, Inc. (NASDAQ:CELH) said it would acquire Alani Nutrition, a health and wellness drinks brand in a $1.8 billion deal. The move is set to further bolster Celsius Holdings, Inc. (NASDAQ:CELH)’s portfolio amid growing energy beverage demand. The company’s share price had surged by 27% as of the close of business a day later, on February 21.
This has led to a bullish wave around Celsius Holdings, Inc. (NASDAQ:CELH), with several analysts reiterating their Strong Buy rating for the stock. Investor sentiment continues to improve. According to Insider Monkey’s database for Q4 2024, 33 hedge funds held a stake in the company, up from 29 at the end of the third quarter.
1. MGP Ingredients, Inc. (NASDAQ:MGPI)
Average Share Price Upside Potential as of February 20: 119.20%
MGP Ingredients, Inc. (NASDAQ:MGPI) is a leading producer and supplier of distilled spirits, branded spirits, and food solutions. The company’s offerings include bourbon, gins, vodkas, and rye whiskeys. It is the best beverage stock to buy according to analysts.
MGP Ingredients, Inc. (NASDAQ:MGPI) announced mixed results for the third quarter of fiscal 2024. It reported a 24% year-over-year decline in consolidated sales, driven by lower sales across all operating segments. Distilling Solutions sales were down by 36%, while the Branded Spirits segment’s sales dropped 6% from last year. The Ingredient Solutions segment recorded an 18% dip in sales.
After a decade of robust demand, with a boom during the pandemic, the American whiskey market is transitioning from a supercycle toward a downturn, with declining prices, lower demand, and reduced visibility. The company expects the challenging environment to persist, and continue through 2025.
Despite ongoing headwinds, MGP Ingredients, Inc. (NASDAQ:MGPI) reported an 82% increase in net income for the quarter compared to last year. Adjusted EPS was logged at $1.29, which was down from $1.36 per share last year, but beat analysts’ estimates by two cents. It ended the quarter with $20.8 million in cash.
MGP Ingredients, Inc. (NASDAQ:MGPI) has highlighted a strategic action plan to stabilize the business amid softening trends in the market. The company will optimize its cost structure, reduce whiskey production and aging whiskey put-aways, and focus on international expansion to leverage the strong growth potential outside the U.S.
Overall, MGP Ingredients, Inc. (NASDAQ:MGPI) ranks first among the 10 Best Beverage Stocks to Buy According to Analysts. While we acknowledge the potential of beverage companies, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than MGPI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap
Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.
