Tag Archives: Sam Adams

Business, Finance, Occupation & Industry

Is Boston Beer One of the Best Companies in America?

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By Daniel Ferry, The Motley Fool

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When The Motley Fool set out to discover America’s best publicly traded companies, our team combed through more than 1,700 names and examined how well they served four groups of stakeholders: investors, customers, employees, and the world at large. The result was our list of the 25 best companies in America. Of course, picking so few winners leaves quite a few remarkably high-quality companies that deserve an honorable mention. One company that finished in the top 40 was Boston Beer .

In 1984, Jim Koch gave up a consulting career to brew beer in his kitchen from an old family recipe. He named his beer Samuel Adams, and the Boston Beer Company was born. From that first batch in the kitchen, Boston Beer has grown to become a $1.8 billion company.

The popularity of Sam Adams was a big factor in the emergence of small, high-quality craft breweries in recent decades. Today, Sam Adams ships about 3 million barrels of beer annually. That means that while it makes up only about 1% of the overall U.S. beer market, Boston Beer controls nearly a fifth of the fast-growing craft-beer segment. Boston Beer hasn’t let the heady brew of success get to its head, though. The company remains devoted to nurturing other brewers and small entrepreneurs, inspired to help other small businesses overcome the hurdles Jim Koch encountered when he was just starting out.

The case for Boston Beer
Boston Beer certainly helped smaller brewers just by introducing drinkers nationwide to craft beers, and it’s gone a step further through its “Brewing the American Dream” program, which provides loans and business coaching to entrepreneurs in the food, beverage, and hospitality industry. In 2007, Koch and some employees volunteered to paint a community center. Afterwards, Koch realized he’d “just taken about $10,000 worth of management time and talent, and turned it into about $1,000 worth of painting,” and set about to make better use of philanthropic resources.

Partnering with the small-business microlending organization ACCION, Boston Beer invested $250,000 in lending capital that has become $1.4 million in startup financing. Boston Beer‘s executives also take time to coach and counsel loan recipients, making the company’s expertise and resources available to small entrepreneurs who would struggle to get started otherwise.

Far from seeing new craft brewers as competitors, Boston Beer has actively encouraged small brewers through its philanthropy, even going so far as to give out 40,000 pounds of its own hops to struggling brewers during a 2008 global hops shortage. This approach hasn’t just created jobs and spurred community development, but it’s also allowed Boston Beer to maintain a cool image as a real craft brewer even as it has grown to dominate the space.

Boston Beer is undoubtedly a “cool” place to work, what with the company’s entrepreneurial culture and focus on hip craft beers. The Boston Globe also recognized Boston Beer as having the region’s greatest perk: Employees get to take home two …read more
Source: FULL ARTICLE at DailyFinance

Articles of Interest

Alabama Home Brewing Bill In Works, But For Now State Is Only To Forbid Making Beer At Home

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By The Huffington Post News Editors

If you’re in a state where cousins can legally marry each other, but home brewers are forbidden to practice their craft, you must be in Alabama.

Indeed, Alabama now stands out as the only state where home brewing is illegal. Mississippi voted this week to legalize the hobby lager lovers and hopheads in America have enjoyed, even before George Washington and Sam Adams boiled up their first brews.

Alabamans don’t just get slapped with a ticket if they start mixing up a batch. It’s a felony.

But to a feisty band of Yellowhammer State tipplers, it’s ridiculous for the government to meddle with their malt. They won’t be satisfied until Alabama has the same rights enjoyed everywhere else in the country.

“This is not about alcohol. This is about civil liberties,” said Kraig Torres, owner of Hop City Craft Beer and Wine in Birmingham. “If I went around in Alabama and said, ‘you can’t have a gun in your house,’ I’m pretty sure people would be upset.”

Residents who want to  buy shotguns, rifles or handguns  don’t need permits, licenses or registrations. However, it’s unclear how regulations apply to gunsmiths who forge firearms in their residences.

Torres lives in Georgia and operates his flagship store there. While he’d like to sell beer-making ingredients and cookbooks in his Birmingham venture, he has  gotten into trouble  with the Alabama Alcoholic Beverage Control Board.

In September, before he opened Hop City, state agents inspected the store. Torres said they confiscated $7,000 worth of beer-making kits and cookbooks on a follow-up visit. A lawyer for the beverage control board told HuffPost that Torres removed them from the store after he was told they were contraband.

Alabama maintains a fervent temperance movement. It’s been 80 years since Prohibition’s demise, but there are 25 dry counties in the so-called “Heart of Dixie.” Some teetotalers there wish the libations had never started flowing again.

“We’re talking about a mind-altering, addictive drug,” said Joe Godfrey, a pastor and executive director of ALCAP, a group that opposes loosening any restrictions on alcohol. “This isn’t barbecue. People are killed on the highways. You hear all the time about people being killed under the influence of alcohol. You never hear about people getting killed by barbecue.”

Torres’ experience was a rare instance of the state enforcing the home-brewing ban, according to interviews with home brewers and an Alcoholic Beverage Control Board lawyer. Just this month, however,  a prosecutor in Mobile County was disciplined  for flouting the home brew restrictions, Al.com reported.

Home-brewing advocates said the felony status scares away some and forces others into the shadows even though the chance of punishment looks slim.

“Home brewers would like to be able to practice their hobby in the open. They have to be fairly secretive,” said American Homebrewers Association Director Gary Glass. “It just doesn’t make sense that it would be prohibited. Many of the Founding Fathers were home brewers including George Washington and Thomas Jefferson.”

Bills to legalize home brewing sit in both houses of the Alabama legislature awaiting a vote. It’s the third straight year legislators have proposed changes to the home brew law.

Partisan squabbling  on unrelated issues may derail it again, according to observers and local media reports.

“We hope it passes so we can move onto more important business,” said Bob Martin, an ABC board lawyer. “We really don’t care. It’s a hobby. It’s not our real concern unless we found out someone was making it and selling it illegally. Generally, we’re not going to go into their homes.”

If passed, the bills would allow Alabamians to whip up limited quantities of intoxicating drinks like beer and wine. Liquor would remain off-limits. It would also pave the way for tasting events and competitions, advocates told HuffPost.

Home brewing was for outlaws and scofflaws throughout the country as a result of Prohibition until then- President Jimmy Carter signed a federal law  decriminalizing the pastime in 1978.

Hobbyists cheered Mississippi Gov. Phil Bryant for ending the state’s ban this week.

“I’m going to have a pint with friends at our local bar in town and then open a bottle of home brew at home” to celebrate, said Craig Hendry, president of Raise Your Pints, a group that hired lobbyists to overturn the ban.

“We want to be talked about in a positive light, not as another state that was the last to do something.”

Editor’s note: To be fair to Alabama,  19 other states  allow first cousins to get hitched too, according to the National Conference of State Legislatures.

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Source: FULL ARTICLE at Huffington Post

Business, Finance, Occupation & Industry

Craft Brew Alliance: An Early Earnings Look

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By Dan Caplinger, The Motley Fool

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Earnings season is winding down, with most companies already having reported their quarterly results. But there are still some companies left to report, and Craft Brew Alliance is about to release its quarterly earnings. The key to making smart investment decisions with stocks releasing their quarterly reports is to anticipate how they’ll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise. That way, you’ll be less likely to make an uninformed knee-jerk reaction to news that turns out to be exactly the wrong move.

Craft Brew Alliance is a tiny player in the beer industry, but the soaring popularity of craft beers has led to some colossal growth for the company. Let’s take an early look at what’s been happening with Craft Brew Alliance over the past quarter and what we’re likely to see in its quarterly report on Tuesday.

Stats on Craft Brew Alliance

Analyst EPS Estimate

$0.01

Change From Year-Ago EPS

0%

Revenue Estimate

$40.7 million

Change From Year-Ago Revenue

17%

Last Quarter’s EPS Result

Missed estimate by $0.05

Source: Yahoo! Finance.

Will Craft Brew Alliance serve up better results this quarter?
Analysts have been less optimistic about Craft Brew Alliance in recent months, pulling in their calls for the just-ended quarter by $0.02 per share and trimming $0.03 per share off full-year 2013 estimates. But that pessimism hasn’t held the stock back from a 7% gain since early December.

Traditionally, the brewing industry was dominated by massive companies that mass-produced commoditized beer, leading to the huge consolidation in the industry that produced Anheuser-Busch InBev and Molson Coors . But the emergence of Sam Adams maker Boston Beer changed the environment for beermakers by establishing that craft beers could be successful from a quality standpoint and profitable. Budweiser and Coors have done their best to answer the changing trend, but attitudes among craft-beer drinkers favor smaller companies, and that’s been good news for Craft Brew Alliance and small privately held breweries.

Still, Craft Brew faces its challenges. The company is too small to have its own distribution network and therefore relies on Anheuser-Busch for distribution, putting it in an awkward competitive position. Moreover, Boston Beer’s Alchemy & Science division has looked at developing and promoting new craft beers from breweries across the country, creating more competition for Craft Brew in its home segment.

In its quarterly report, pay close attention to Craft Brew‘s discussion of its new export deal with CraftCanTravel, which is set to open up markets throughout Europe and Asia to the company. With strong international interest in beer, how Craft Brew‘s offerings are received could make a huge difference to its growth trajectory in the years to come.

Craft beer is becoming a big business, and while just a few years ago, Boston Beer had claim over most of the …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Is Boston Beer Overvalued?

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By Daniel Ferry, The Motley Fool

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and its
Samuel Adams brand helped to redefine beer and kick off the craft beer revolution in the United States. Success breeds competition, though, and while just a few years ago Boston Beer had a claim over most of the craft-beer shelf, today the field is crowded. Can Boston Beer rise above the rest, or will it be squeezed between small local breweries on one side and global beer giants on the other? To help you decide, we’ve compiled a premium research report filled with everything you need to know about Boston Beer‘s prospects,
and what sorts of risks the company faces.

Nobody doubts that execution at Boston Beer has been strong, and the company could continue to grow sales impressively, but an investor needs to have an idea of how large Boston Beer‘s market opportunity could be. Today, you can get a sneak peek at the report, detailing one major risk that Boston Beer shareholders face: the idea that the company might be overvalued.

Your sneak peek follows.

The biggest risk for an investor today is that shares of Boston Beer are priced not only to beat all these risks, but the company is priced to perform pretty close to perfectly. The decline of the core Sam Adams brands demonstrates that the larger Boston Beer gets, the more difficult it will be for the company to put up the same kind of rapid growth figures it has in its past. Going forward, strong growth is going to come at a higher cost for Boston Beer as the company can’t rely on improved distribution of its existing products, and instead must constantly invest in new styles. Boston Beer‘s cost of goods sold has been rising faster than its revenue for the past decade, and with consumer demand for ever more variety, it isn’t clear that Boston Beer will be able to reverse this trend.

The sheer size of the company will also prevent Boston Beer from repeating its past performance. Yes, Sam Adams is only 1% of the American beer market, which seems quite small. Cast another way, however, Sam Adams has about 18% of the total craft beer market as of 2011. The company is facing three potential ceilings.

First, how much market share can Sam Adams take in the craft beer segment, facing strong competition from regional and local brewers? Second, how much market share can the total craft segment take from the overall beer market, as the major brewers fight back with “faux craft” offerings? Finally, as wine and spirits continue to grow at the expense of beer in the alcoholic beverage market, how large will the total domestic beer market even be in 10 years?

To justify its current valuation, with a price-to-earnings ratio around 35, Boston …read more
Source: FULL ARTICLE at DailyFinance