Boston Beer stock's recent dip (and today's earlier price action) brought it closer to its May 28 five-year low of $254.40. Year to date, SAM is currently down 18.8%. It's worth noting that the stock's 14-day relative strength index (RSI) of 16.3 sits firmly in "oversold" territory, which typically precedes a short-term bounce. The stock's typically quiet options pits are seeming some activity, with the most volume at the August 330 call. In fact, the eight most popular contracts so far are calls. Analysts ...

Core Viewpoint - Boston Beer reported disappointing Q2 2024 earnings, with significant declines in shipment volumes and net income, prompting a downward revision of volume guidance for the full year [2][3][8]. Financial Performance - Net revenue decreased by 4% year over year to $579.1 million, down from $603.3 million in Q2 2023 [8][9]. - Net income fell by 9.8% to $52.3 million, compared to $58.0 million in the same quarter last year [8][9]. - Gross margin improved slightly to 46.0%, up from 45.4% in Q2 2023, attributed to price increases and procurement savings, despite higher processing costs and inflation [5][8][12]. Shipment Volumes - Shipment volume for the quarter was approximately 2.2 million barrels, reflecting a 6.4% decline from 2.3 million barrels in Q2 2023 [9][11]. - The decline in shipment volumes was primarily driven by underperformance in the Truly Hard Seltzer brand, while Twisted Tea and the newly launched Sun Cruiser brand showed growth [11][12]. Inventory and Operational Challenges - The company faced low inventory levels, averaging about three and a half weeks on hand, below the target of four to five weeks, indicating distribution inefficiencies [13]. - Rising production costs and inflationary pressures continued to impact profitability, despite some operational improvements [12]. Strategic Focus - Management maintained its full-year GAAP EPS guidance of $7.00 to $11.00, indicating confidence in long-term growth despite current challenges [14]. - Volume guidance was revised downward to reflect a flat or low single-digit decline in depletions and shipments [14].

Financial Data and Key Metrics Changes - Revenue for the quarter decreased by 4% due to lower volumes, partially offset by pricing and low returns [61] - The second quarter gross margin increased by 60 basis points to 46% from 45.4% in the prior year, benefiting from price increases and procurement savings [62] - Earnings per diluted share (EPS) was reported at $4.39, which was $0.32 lower than the second quarter of 2023 [53] Business Line Data and Key Metrics Changes - Twisted Tea grew by 15.1% in dollars and increased dollar share of FMBs by 1.6 share points, with shelf space increasing approximately 30% year-over-year [38] - Truly Hard Seltzer saw a volume decline of 22.8%, losing 2.1 share points, while lighter core packages within the Truly portfolio were down mid-single digits year-over-year [32] - The launch of Sun Cruiser has shown positive trends in depletions, distribution, and sales per point, indicating strong initial reception [39] Market Data and Key Metrics Changes - The overall Hard Seltzer category declined by 14.9% in volume, reflecting increased competition and consumer choices [32] - Distributor inventories as of June 29, 2024, averaged approximately three and a half weeks on hand, below the target of four to five weeks for the peak summer season [48] - Year-to-date depletions decreased by 2% compared to 2023, with expectations for a rebound in the second half of the year [63] Company Strategy and Development Direction - The company aims to improve end-to-end execution to unlock additional revenue and improve margins while nurturing core brands and developing margin-accretive innovations [29] - Focus will be on optimizing product development, manufacturing, and capital allocation to support a diversified portfolio [50] - The strategy includes a disciplined product roadmap and a commitment to invest in both core brands and new Beyond Beer categories [36] Management's Comments on Operating Environment and Future Outlook - Management noted that the first half of 2024 experienced challenges, but there is confidence in a recovery in the latter half of the year [59] - The company is optimistic about the growth potential of Twisted Tea and the new product Sun Cruiser, which is expected to attract new consumers [39] - Management acknowledged the need to regain market share and improve execution across all brands, particularly in the beer segment [99] Other Important Information - The company generated over $90 million in operating cash flow and repurchased $125 million worth of stock year-to-date [26] - Capital expenditures for 2024 are expected to range between $90 million and $110 million, primarily for brewery capabilities and efficiencies [57] - The company is committed to supporting brands with appropriate advertising investments, particularly in the second half of the year [46] Q&A Session Summary Question: What is the mid-term growth outlook for Twisted Tea? - Management expects another strong year of growth for Twisted Tea, with significant unrealized potential and plans for increased brand support and advertising [6] Question: How is the company addressing the decline in Hard Seltzer? - The company is focusing on gaining share and shelf space for lighter flavors and optimizing the flavor assortment to improve performance [32] Question: What are the expectations for Hard Mountain Dew? - Hard Mountain Dew is expected to benefit from expanded distribution and marketing support, with a more significant impact anticipated in 2025 [34] Question: How does the company plan to manage operating expenses? - The company plans to align internal costs with revenue while increasing marketing spend in the second half to support key launches [84] Question: What is the company's stance on being an independent public company? - Management reiterated the focus on growing the business as an independent company and emphasized the strength of its brand portfolio [137]

Over the last four quarters, the company has surpassed consensus EPS estimates two times. Boston Beer shares have lost about 21.3% since the beginning of the year versus the S&P 500's gain of 13.8%. Ahead of this earnings release, the estimate revisions trend for Boston Beer: mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to ...

[Financial Highlights](index=1&type=section&id=Financial%20Highlights) Despite revenue and depletions declines, the company achieved gross margin improvement and increased net income Q2 2024 Financial Metrics | Metric | Q2 2024 | Change (YoY) | | :--- | :--- | :--- | | Depletions | -4% | N/A | | Shipments | -6.4% | N/A | | Net Revenue | $579.1 million | -4.0% | | Gross Margin | 46.0% | +60 bps | | Net Income | $52.3 million | -9.8% | | Diluted EPS | $4.39 | -7.0% | YTD 2024 Financial Metrics | Metric | YTD 2024 | Change (YoY) | | :--- | :--- | :--- | | Depletions | -2% | N/A | | Shipments | -3.4% | N/A | | Net Revenue | $1.005 billion | -0.8% | | Gross Margin | 45.0% | +260 bps | | Net Income | $64.9 million | +32.3% | | Diluted EPS | $5.41 | +35.9% | - The company repurchased **$127.0 million** of its Class A Common Stock from January 2, 2024, to July 19, 2024[2](index=2&type=chunk)[26](index=26&type=chunk) [Management Commentary](index=2&type=section&id=Management%20Commentary) Management revised volume guidance but maintained EPS guidance, focusing on execution, innovation, and margin expansion - CEO Michael Spillane stated the company is revising volume guidance due to softer category performance and product launch timing, but maintaining EPS guidance supported by transformation efforts, focusing on optimizing execution and launching accretive innovation[3](index=3&type=chunk) - Chairman Jim Koch highlighted that gross margin improvement initiatives are working, with a year-to-date expansion of over **250 basis points** and strong cash flow, noting that while depletions were soft in April, they improved through the quarter[17](index=17&type=chunk) [Detailed Financial Results](index=2&type=section&id=Detailed%20Financial%20Results) Despite revenue declines, gross margins significantly improved in Q2 and YTD, driven by price increases and savings [Second Quarter 2024 Performance](index=2&type=section&id=Second%20Quarter%202024%20Performance) - Q2 shipment volume was approximately **2.2 million barrels**, a **6.4% decrease** from the prior year, mainly due to declines in Truly Hard Seltzer, partially offset by growth in Twisted Tea and the new Sun Cruiser brand[18](index=18&type=chunk) - Q2 gross margin increased to **46.0%** from **45.4%** year-over-year, benefiting from price increases and procurement savings, though negatively impacted by **$3.0 million** in shortfall fees (**50 bps**) and **$6.2 million** in non-cash expense of third-party production pre-payments (**110 bps**)[5](index=5&type=chunk)[21](index=21&type=chunk) - Advertising, promotional and selling expenses decreased by **$5.1 million** (**3.4%**) due to lower freight costs and reduced brand media spend[6](index=6&type=chunk) - General and administrative expenses rose by **$3.1 million** (**7.0%**) primarily due to inflation in salaries and benefits[22](index=22&type=chunk) - The effective tax rate for Q2 was **28.6%**, up from **27.5%** in the prior year, due to an increase in non-deductible stock compensation expense[7](index=7&type=chunk) [Year-to-Date 2024 Performance](index=3&type=section&id=Year-to-Date%202024%20Performance) - YTD shipment volume was approximately **3.8 million barrels**, a **3.4% decrease** from the prior year, reflecting similar brand trends as Q2[23](index=23&type=chunk) - YTD gross margin increased significantly by **260 basis points** to **45.0%**, driven by price increases, procurement savings, and lower returns and obsolescence costs[9](index=9&type=chunk)[17](index=17&type=chunk) - YTD advertising, promotional and selling expenses decreased by **$10.3 million** (**3.7%**) due to lower freight costs and reduced brand media spend[10](index=10&type=chunk) - YTD general and administrative expenses increased by **$9.8 million** (**11.1%**), primarily due to CEO transition costs and inflation[34](index=34&type=chunk) - YTD net income increased by **$15.9 million** to **$64.9 million**, primarily driven by higher gross margins that offset lower revenue[11](index=11&type=chunk) [Financial Position and Cash Flow](index=2&type=section&id=Financial%20Position%20and%20Cash%20Flow) The company maintains a strong financial position with cash and no debt, generating operating cash flow and returning capital - The company ended the quarter with **$219.3 million** in cash and cash equivalents and no debt[16](index=16&type=chunk)[17](index=17&type=chunk) - Distributor inventory as of June 29, 2024, was below target at approximately **3.5 weeks** on hand, compared to a target of 4 to 5 weeks for the peak season[19](index=19&type=chunk) Cash Flow Activity (YTD 2024) | Cash Flow Activity (YTD 2024) | Amount (in thousands) | | :--- | :--- | | Net cash provided by operating activities | $91,116 | | Net cash used in investing activities | ($56,067) | | Net cash used in financing activities | ($114,245) | - The company repurchased **$127.0 million** in shares year-to-date through July 19, 2024, with approximately **$140 million** remaining on its share buyback authorization[26](index=26&type=chunk) [Full-Year 2024 Outlook](index=4&type=section&id=Full-Year%202024%20Outlook) The company revised full-year depletions and shipments guidance, while maintaining gross margin and EPS targets Full Year 2024 Guidance | Full Year 2024 Guidance | Current Guidance | Prior Guidance | | :--- | :--- | :--- | | Depletions & Shipments % Change | Down low single digit to zero | Down low single digit to up low single digit | | Price Increases | 1% to 2% | 1% to 2% | | Gross Margin | 43% to 45% | 43% to 45% | | GAAP EPS | $7.00 to $11.00 | $7.00 to $11.00 | | Capital Spending ($ million) | $90 to $110 | $90 to $110 | - Year-to-date depletions through the 29-week period ended July 20, 2024, are estimated to have decreased approximately **2%** from the comparable period in 2023[36](index=36&type=chunk) - For the full year 2024, the company estimates that shortfall fees and non-cash expenses from third-party production prepayments will negatively impact gross margin by a combined **135 to 185 basis points**[29](index=29&type=chunk) [Appended Financial Statements](index=6&type=section&id=Appended%20Financial%20Statements) The release provides unaudited condensed consolidated financial statements, detailing income, balance sheets, and cash flows [Condensed Consolidated Statements of Comprehensive Income](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows)

BOSTON, July 25, 2024 (GLOBE NEWSWIRE) -- The Boston Beer Company, Inc. (NYSE: SAM), today reported financial results for the second quarter ended June 29, 2024. Key results were: Second Quarter 2024 Summary: Depletions decreased 4% and shipments decreased 6.4% Net revenue of $579.1 million decreased 4.0% Gross margin of 46.0% up 60 basis points year over year Net income of $52.3 million, a decrease of $5.7 million or 9.8% Diluted income per share of $4.39 Year-to-date 2024 Summary: Depletions decreased 2% ...

Core Viewpoint - Boston Beer Company is expected to report second-quarter 2024 results on July 25, with anticipated bottom-line growth compared to the previous year [1] Earnings Estimates - The Zacks Consensus Estimate for earnings is $4.96 per share, indicating a growth of 5.1% from the year-ago quarter, although the estimate has declined by 2.4% in the past 30 days [2] - The consensus estimate for quarterly revenues is $595.2 million, suggesting a 1.4% decline from the previous year's reported figure [2] Volume and Revenue Trends - The second-quarter results are expected to reflect trends in volumes, pricing, and margin performance, with improved volumes and favorable pricing noted in the first quarter [3] - Continued momentum in the Twisted Tea brand and efforts to maintain core brand relevance are anticipated to drive robust volume trends in the second quarter [3][5] - The company is focused on nurturing its core brands and driving innovation through the Beyond Beer initiative, which is expected to contribute to category growth [4] Operational Performance - Boston Beer has benefited from strong price realization, procurement savings, and improved brewery performance, which are expected to bolster gross margin despite inflationary pressures [7] - However, gross margin may be impacted by shortfall fees and third-party production prepayments, which are likely to continue affecting growth in the second quarter [8] Category Challenges - The hard seltzer category slowdown is expected to weigh on the performance of the Truly brand, with anticipated volume declines throughout 2024 [9]

The market expects Boston Beer (SAM) to deliver a year-over-year increase in earnings on lower revenues when it reports results for the quarter ended June 2024. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates. While management's discussion of business conditions on the earnings call will mostly determine the sustainability of the immediate pr ...

Core Viewpoint - Starcore International Mines Ltd. has commenced exploration activities on the Kimoukro permit in central Ivory Coast, focusing on gold mineralization in an area with significant artisanal mining activity [11][12]. Exploration Activities - The initial phase includes a 2000 m auger drilling program to investigate gold anomalies in saprolite and assess the continuity of known mineralized veins [6][11]. - A ground-magnetic survey will be conducted alongside an induced polarization (IP) geophysical survey, with a total of 50 line-kilometers planned [5][26]. - Trenching will be performed to test known higher gold anomaly zones, with an initial program consisting of 1500 m of trenches, 5 m deep [18][22]. Geological Context - The Kimoukro permit contains at least 11 gold-mineralized veins, with thicknesses ranging from 0.5 to 1.0 m and inferred strike lengths exceeding 150 m [2][3]. - The depth to rock in the area ranges from 2 to 20 m, averaging around 10 m, indicating potential for deeper exploration [3]. Historical Data and Analysis - Previous exploration by K Mining included IP surveys covering 0.9 km² and 1.3 km² in 2019 and 2021, respectively, which have been reprocessed for better interpretation [14]. - Soil geochemistry conducted between 2019 and 2022 highlighted over 65 hectares of soil anomaly greater than 50 ppb, although surface samples only reached depths of 0.5 m to 1 m [24]. Project Management - Starcore aims to complete all exploration activities before the heavy rain season, typically occurring in September [7]. - SAGAX Afrique sarlu has been retained to implement the IP and ground magnetic program, expected to be completed by the end of July 2024 [12].

Core Insights - TeaPot, a cannabis-infused iced tea brand from The Boston Beer Company, is expanding its product lineup with the introduction of Lemonade Iced Tea and CBD Lemon Black Tea [1][4]. Product Details - CBD Lemon Black Tea contains 20mg of CBD and less than 0.5mg of THC, offering a refreshing beverage with 100 calories, currently available in Ontario and Quebec with plans for further expansion [2]. - Lemonade Iced Tea is a blend of black tea and lemonade infused with 5mg of THC, containing 130 calories per 355mL can, also available in Ontario and Quebec with expansion plans throughout the year [3]. Company Background - The Boston Beer Company, established in 1984, is a leading craft brewer in the U.S., known for its high-quality products and innovation in "beyond beer" categories, including hard cider, hard seltzer, and hard tea [6].