In this article, we discuss the 10 best whiskey and alcohol stocks to buy in 2022. If you want to skip our detailed analysis of the liquor industry which highlights key trends and major players, you can go directly to 5 Best Whiskey and Alcohol Stocks To Buy in 2022.
The novel coronavirus pandemic caused many industries to collapse, including the global liquor industry, which was one of the hardest-hit industries in 2020. However, as bars and pubs around the world reopened and social distancing constraints eased, the liquor market embarked on its journey to recover from the nerve-racking effects of the pandemic. Even though the market is still suffering the aftershocks of Covid-19, it is on a trajectory to fully recover and surpass pre-pandemic levels by the end of 2022.
The Liquor Industry Analysis: Size, Trends, and Key Players
According to Statista, the global market share of alcoholic beverages came in at $1.49 trillion in 2020, down roughly $200 billion from 2019. Then in 2021 as economies around the world reopened, the revenues from the alcoholic beverages industry recovered to $1.55 trillion. Statista further estimates 2022 numbers to peak at $1.81 trillion, and the alcoholic beverages industry to hit $2.2 trillion by 2025.
Mordor Intelligence published a report in which they estimated the global alcoholic beverages market to grow at a CAGR of 3.4% from 2022 to 2027. Mordor Intelligence found that in 2020, the premium alcohol market grew by 9% year over year, driven by growth in demand for premium and super-premium whiskey. Moreover, they expect the North American market to remain dominant over the forecasted period and the Asia Pacific markets to mature further from a rise in disposable income. The US wine market consists of over 10,000 wineries, with California having the dominant share of over 85%, followed by Washington, Oregon, New York, Texas, and Virginia. Wine is becoming a popular alcoholic beverage among American consumers given its healthier variants, and an increasing adoption of clean-eating lifestyles.
The major players in the alcoholic beverages industry include Brown-Forman Corporation (NYSE:BF.B), Constellation Brands, Inc. (NYSE:STZ), and The Boston Beer Company, Inc. (NYSE:SAM).
Photo by Adam Wilson on Unsplash
Our Methodology
To determine the 10 best whiskey and alcohol stocks to buy in 2022, we did a careful assessment of the global liquor industry and identified major players that operate prominent brands. We narrowed down our selection to high-performance and high-momentum stocks, that are experiencing bullish trends in the market.
We also considered the analyst and investor sentiment for each stock as we believe both metrics to be key indicators of future performance. We derived the hedge fund sentiment from Insider Monkey’s database of 924 elite hedge funds.
Best Whiskey and Alcohol Stocks To Buy in 2022
10. Remy Cointreau SA (OTC:REMYY)
Number of Hedge Fund Holders: N/A
Remy Cointreau SA (OTC:REMYY) produces and distributes liquor and spirits. The company operates through three business segments: Rémy Martin, Liquor & Spirits, and Partner Brands. The company markets its products through distributors, agents, and wholesalers in Europe, the Middle East, Africa, the Americas, Asia, Australia, and New Zealand.
This April, Remy Cointreau SA (OTC:REMYY) reported record-high earnings for the fiscal year 2021. According to the company’s report, Remy Cointreau SA (OTC:REMYY) generated revenues of EUR 1.31 billion, up 29.7% year over year. The company reported organic revenue growth of 27.3% year over year which included a 9.2% increase in mix-effect and a remarkable 18.2% increase in trading volumes.
The stock is attracting multiple buy ratings from expert financial analysts who believe in the company’s long-term milestones, which makes it one of the best whiskey and alcohol stocks to buy in 2022. On May 3, Deutsche Bank analyst Mitch Collett raised his price target on Remy Cointreau SA (OTC:REMYY) to EUR 290 from EUR 274 and maintained a Buy rating on the shares.
Remy Cointreau SA (OTC:REMYY) is rising to prominence in the liquor industry and is a must-watch whiskey and alcohol stock in 2022. Other stocks that are proving to be lucrative for investors include Brown-Forman Corporation (NYSE:BF.B), Constellation Brands, Inc. (NYSE:STZ), and The Boston Beer Company, Inc. (NYSE:SAM).
9. Vintage Wine Estates Inc. (NASDAQ:VWE)
Number of Hedge Fund Holders: 7
Vintage Wine Estates Inc. (NASDAQ:VWE) is responsible for producing premium wines and delivering excellent customer experiences. The company operates wineries throughout Napa, Sonoma, California’s Central Coast, Oregon, and Washington State. The company boasts a portfolio of luxury wines, award-winning wines, everyday wines, inspired classic wines, inventive new vintages, and spirits among other alcoholic beverages.
Vintage Wine Estates Inc. (NASDAQ:VWE) is moving fast, but moving surely. On March 8, the company announced that its board of directors have authorized a share repurchase program worth $30 million in an aggregate value of the company’s common stock through September 8. Moreover, Vintage Wine Estates (NASDAQ:VWE) surged 8% in a day right after the company announced insider buying of roughly 47,000 shares which amounted to $390,000. CEO Patrick Roney bought 35,400 shares of the stock between $8.18 and $8.35 per share, and the company’s director Jon Moramarco bought 11,500 shares at a rate between $8.23 and $8.60.
Hedge funds are raising their stakes in Vintage Wine Estates Inc. (NASDAQ:VWE). At the end of the fourth quarter of 2021, 7 hedge funds held stakes in the company worth $75.47 million, up from $56.62 million in the prior quarter with 7 positions.
Paradice Investment Management was identified as the most bullish hedge fund on Vintage Wine Estates Inc. (NASDAQ:VWE) at the end of this March. According to Insider Monkey’s database, the fund’s stakes were valued at $40.5 million, which covers 2.37% of its 13F portfolio.
8. Ambev SA (NYSE:ABEV)
Number of Hedge Fund Holders: 16
Ambev SA (NYSE:ABEV) is a leading Brazilian brewing company that is known for its beer, draft beer, carbonated soft drinks, and non-alcoholic beverages. The company operates through four segments: Brazil; Central America and the Caribbean, and Canada.
Shares of Ambev SA (NYSE:ABEV) are picking up momentum and the stock is becoming popular among expert financial analysts. This January, Citi analyst Sergio Matsumoto upgraded Ambev to Buy from Neutral. Matsumoto contended that he expects a long-term recovery in sales volume, market share, and channel mix. Moreover, as of May 13, Ambev SA (NYSE:ABEV) has gained 5.15% year to date.
On May 5, Ambev SA (NYSE:ABEV) released its earnings for the fiscal first quarter of 2022 in which it outperformed market consensus. The company reported earnings per share of $0.04, and beat EPS estimates by $0.01. The company generated revenues of $3.68 billion, up 16.63% year over year, and beat estimates by $23.55 million.
Ambev SA (NYSE:ABEV) is becoming a top stock pick among investor circles. At the close of Q4 2021, 16 hedge funds were long Ambev SA (NYSE:ABEV) with stakes of $171.08 million. This is compared to 15 positions in the previous quarter with stakes of $79.89 million.
As of March 31, First Eagle Investment Management is the dominating stakeholder in Ambev SA (NYSE:ABEV) with more than 274.3 million shares of stock. This brings the fund’s stakes to $886.03 million, which covers 2.16% of its Q1 2022 investment portfolio.
Harding Loevner mentioned Ambev SA (NYSE:ABEV) in its recently published “Emerging Markets Equity Fund” fourth-quarter 2021 investor letter:
“Consumer Staples companies are typically considered to have strong pricing power, supported by the consumer loyalty to their brands that they have earned through advertising. But in some product categories competition and fear of losing market share may preclude raising prices significantly. Such is the case for Brazilian brewer Ambev, which in recent years has faced an intensifying competitive rivalry with Heineken in Brazil’s premium beer market. That has forced Ambev to find other ways to sustain its profits in the face of soaring costs for materials. One of its strategies has been to diversify its portfolio of brands across “core,” “core plus,” and “premium” segments, each at a different price point, which has helped to both attract new beer drinkers as well as retain established customers when they look to save money in a slowing economy. Ambev has also invested in technology that allows it to respond more rapidly to shifts in consumer demand—delivering the right beer in the right packaging and quantity, almost in advance of the retailer or distributor themselves knowing what will sell.”
7. Anheuser-Busch InBev SA (NYSE:BUD)
Number of Hedge Fund Holders: 17
Anheuser-Busch InBev SA (NYSE:BUD) produces, distributes, and sells beer, alcoholic beverages, and soft drinks worldwide. The company offers a portfolio of approximately 500 beer brands. Anheuser-Busch InBev SA (NYSE:BUD) is being closely watched by analysts. On May 6, Deutsche Bank analyst Mitch Collett raised his price target on Anheuser-Busch InBev SA (NYSE:BUD) to EUR 67 from EUR 64 and reiterated a Buy rating on the shares.
Anheuser-Busch InBev SA (NYSE:BUD) had a profitable first quarter this year and posted market-beating earnings on May 5. The company reported earnings per share of $0.67 and beat EPS estimates by $0.07. Anheuser-Busch InBev SA (NYSE:BUD) saw revenue growth of 7.66% year over year, which brought its generated quarterly revenues to $13.24 billion, outperforming market consensus by $32.27 million. The company reported total volume growth of 2.8%, with beer volumes up 2.2% and non-beer volumes by 6.0%.
Anheuser-Busch InBev SA (NYSE:BUD) issued a 2022 outlook along with its earnings release and reported that the company expects in-line EBITDA growth, and revenues to grow ahead of EBITDA, catalyzed by a powerful combination of increased volumes and prices in the fiscal year 2022. Robust demand for its premium products and the company’s beer brands remaining strong in the liquor market make Anheuser-Busch InBev SA (NYSE:BUD) the seventh-best whiskey and alcohol stock to buy in 2022.
By the end of the fourth quarter of 2021, 17 hedge funds held stakes in Anheuser-Busch InBev SA (NYSE:BUD). The total value of these stakes came in at $642.04 million.
Ken Fisher’s Fisher Asset Management was the leading shareholder in Anheuser-Busch InBev SA (NYSE:BUD) at the end of March 2022. As of March 31, the fund owns more than 8.6 million shares of the company which amount to a stake value of $521.74 million.
Anheuser-Busch InBev SA (NYSE:BUD) is a compelling pure-play in the liquor market. Other attractive long plays include Brown-Forman Corporation (NYSE:BF.B), Constellation Brands, Inc. (NYSE:STZ), and The Boston Beer Company, Inc. (NYSE:SAM).
Broyhill Asset Management mentioned Anheuser-Busch InBev SA (NYSE:BUD) in its fourth-quarter 2021 investor letter. Here is what the firm had to say:
“Shares of ABI struggled to buck the double-digit decline in emerging market indices in the second half of the year. Consensus concerns around commodity cost headwinds certainly didn’t help matters, but beyond short term margin pressures, both businesses continue to grow their profits as well as their economic moats. ABI controls over a quarter of the nearly $600 billion global beer market, based on Euromonitor data, and remains well positioned for a rebound in post-pandemic industry sales.”
6. MGP Ingredients Inc (NASDAQ:MGPI)
Number of Hedge Fund Holders: 17
MGP Ingredients, Inc. (NASDAQ:MGPI) is a leading producer of distilled spirits, branded spirits, and food ingredients. The company operates through three business segments: Distillery Products, Branded Spirits, and Ingredient Solutions.
MGP Ingredients, Inc. (NASDAQ:MGPI) is experiencing growing demand for its American whiskey. On February 17, 2022, the company announced the commencement of a $12 million barrel warehouse which will produce the company’s American whiskey. The expansion is expected to reach completion in late 2022 and is expected to increase the company’s capacity by 75%.
MGP Ingredients Inc (NASDAQ:MGPI) is surging and is making profits while at it. This May, the company reported earnings for the fiscal first quarter of 2022 in which it beat both EPS and revenue estimates. According to the company’s earnings report, MGP Ingredients Inc (NASDAQ:MGPI) registered an EPS of $1.69, beating estimates by $0.74. The company’s quarterly revenues came in at $195.24 million, up 80.23% year over year, and outperformed market consensus by $21.64 million. The company also announced that its board of directors has declared a quarterly cash dividend of $0.12 per share of common stock, payable on June 3 to investors of record on May 20. The stock’s forward yield at the time of the announcement was 0.5%. On top of this, MGP Ingredients Inc (NASDAQ:MGPI) raised its fiscal year 2022 guidance and reaffirmed an EPS view of $4.0 and revenue views between $690 million and $715 million.
Moreover, as of May 13, MGP Ingredients Inc (NASDAQ:MGPI) has returned 51.35% to investors over the past twelve months, which makes it a high-momentum play for investors. Moreover, the stock is one of the few dividend players in the liquor industry and is therefore ranked among the 10 best whiskey and alcohol stocks to buy in 2022.
Insider Monkey spotted MGP Ingredients Inc (NASDAQ:MGPI) on 17 investment portfolios at the end of Q4 2021. These funds held combined stakes of $54.59 million in the company, up from $32.10 million in Q3 2021 with 13 positions. The hedge fund sentiment for the stock is positive.
Arrowstreet Capital was identified to be the most bullish on MGP Ingredients Inc (NASDAQ:MGPI) at the end of March 2022. The fund’s stakes came in at roughly $5.80 million.
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Disclose. None. 10 Best Whiskey and Alcohol Stocks To Buy in 2022 is originally published on Insider Monkey.
