Boston Beer (SAM) Soars 4.6%: Is Further Upside Left in the Stock?

Boston Beer (SAM) shares ended the last trading session 4.6% higher at $199.64. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 13.6% loss over the past four weeks.

Boston Beer is benefiting from brand strength, strong price realization and procurement savings, which more than offset the impacts of inflationary costs. The company has been strongly focusing on quality, authenticity and innovation.  Recently, Samuel Adams has released the Sam Adams Summer Ale Census, with distinct insights into how consumers enjoy beer.

This brewer is expected to post quarterly earnings of $4.40 per share in its upcoming report, which represents a year-over-year change of +0.2%. Revenues are expected to be $598.55 million, up 3.4% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For Boston Beer, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on SAM going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Boston Beer is a member of the Zacks Beverages - Alcohol industry. One other stock in the same industry, Molson Coors Brewing (TAP), finished the last trading session 2% higher at $49.07. TAP has returned -9% over the past month.

For Molson Coors, the consensus EPS estimate for the upcoming report has changed -0.7% over the past month to $1.89. This represents a change of -1.6% from what the company reported a year ago. Molson Coors currently has a Zacks Rank of #5 (Strong Sell).

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This article originally published on Zacks Investment Research (zacks.com).

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