Should Investors be Confident in Boston Beer Company’s (SAM) Returns?
SouthernSun Asset Management, LLC, an investment management firm, released its “SouthernSun SMID Cap Strategy” first quarter 2024 investor letter. A copy of the same can be downloaded here. In the first quarter, the strategy returned 8.53% on a gross basis (8.33% net) compared to a 6.92% return for the Russell 2500 Index and 6.07% for the Russell 2500 Value Index. The fund returned 22.95% on a gross basis (22.00% net) over the trailing 12 months compared to 21.43% and 21.33% returns for the indexes respectively over the same period. In addition, please check the top 5 holdings of the strategy to know its best pick in 2024.
SouthernSun SMID Cap Strategy featured stocks like The Boston Beer Company, Inc. (NYSE:SAM) in the first quarter 2024 investor letter. Headquartered in Boston, Massachusetts, The Boston Beer Company, Inc. (NYSE:SAM) produces and sells alcoholic beverages. On May 1, 2024, The Boston Beer Company, Inc. (NYSE:SAM) stock closed at $276.57 per share. One-month return of The Boston Beer Company, Inc. (NYSE:SAM) was -5.50%, and its shares lost 8.09% of their value over the last 52 weeks. The Boston Beer Company, Inc. (NYSE:SAM) has a market capitalization of $3.347 billion.
SouthernSun SMID Cap Strategy stated the following regarding The Boston Beer Company, Inc. (NYSE:SAM) in its first quarter 2024 investor letter:
"The Boston Beer Company, Inc. (NYSE:SAM), a leading provider of alcohol beverages, was one of the top detractors in the SMID Cap strategy in the first quarter. The company reported a modest revenue decline (on a comparable basis) for 2023, with strong growth in the Twisted Tea brand offset by declines in the Truly brand. Margins expanded during the year, including in the fourth quarter, as the company benefited from operational margin improvement initiatives, as well as deflation in freight costs. The company expects slight sales growth at the midpoint of its guidance and continued margin expansion in 2024. Concurrent with its fourth quarter earnings announcement, the company announced the retirement of CEO Dave Burwick and his replacement with former Nike executive and current SAM board member Michael Spillane. We expect no change in the company’s strategy or its capital allocation from this leadership change. In the near term, we believe the company will remain focused on sustaining Twisted Tea’s growth, turning Truly volume trends, improving operations to enhance gross margins, and thus providing more funds to invest in its core assets as a company – its brands and its sales force. Overall, we remain confident management’s efforts and investments are likely to produce profitable growth that will reward investors over time."
A close-up of bottles of whisky and other alcoholic beverages from a winery.
The Boston Beer Company, Inc. (NYSE:SAM) is not on our list of 30 Most Popular Stocks Among Hedge Funds. At the end of the fourth quarter, The Boston Beer Company, Inc. (NYSE:SAM) was held by 29 hedge fund portfolios, up from 21 in the previous quarter, according to our database.
We previously discussed The Boston Beer Company, Inc. (NYSE:SAM) in another article, where we shared the list of best brewery and distillery stocks to buy. In addition, please check out our hedge fund investor letters Q1 2024 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
