Boston Beer Stock Hits Record High Thanks To Hard Seltzer

, Boston Beer Stock Hits Record High Thanks To Hard Seltzer

Boston Beer’s Jim Koch  and Dogfish Head’s Sam Calagione toast record 2Q results

Even though hard seltzers are brewed in a process similar to beer, they are not beer.

And the fact that their sales is benefiting Boston Beer, home to the Samuel Adams brand as well as the uber-popular Truly Hard Seltzer, speaks volumes as to where the brewing industry may be going.

What are Hard Seltzers Anyway?

Called Flavored Malt Beverages, FMBs in the biz, hard seltzers now represent the biggest new beverage trend since the introduction of Miller Lite in 1973 which led to the growth of the mainstream light beer segment.

Hard seltzers are fizzy flavored beverages that deliver buzz with significantly less calories than most craft beers.

Boston Beer’s Truly Hard Seltzer has only 100 calories, one gram of sugar, and 5 percent alcohol by volume (ABV).  While Samuel Adams Oktoberfest, for instance, delivers a similar buzz but with 160 calories. So there’s that.

And why do some classify Hard Seltzers as Beer?

The majority of hard seltzers are produced from either a brewed-malt (“clear malt”) or brewed-cane sugar base, with carbonated water and added flavor.

, Boston Beer Stock Hits Record High Thanks To Hard SeltzerUnder Alcohol and Tobacco Tax and Trade Bureau (TTB) regulations, both malt- and sugar-based hard seltzers are considered “beer,” but only malt-based hard seltzers are also considered “malt beverages.”

“This means that federal beer rules apply to both malt- and sugar-based hard seltzers, but federal malt beverage labeling and advertising rules apply only to malt-based hard seltzers,” Bevlaw explains.

And maybe because companies like Boston Beer are having such success with products like Truly Hard Seltzer, and the fact that they share a similar fermentation and brewing process, that some industry analysts include FMB’s in their beer segment numbers.

At American Craft Beer we consider beer to be what beer has historically always been. Flavored malt beverages are, like ciders, a different kind of creature.

When we cover hard seltzers it’s because their emergence is impacting the brewing industry, not because we see them as part of the beer segment. A growing number of  craft brewers are now offering their own hard seltzer products if only to service that increasing demand.

And clearly Boston Beer’s fortunes are soaring thanks to its hard seltzer brand.

Boston Beer Post Record 2Q Results Due To Hard Seltzer

In spite of its name it’s important to remember that Boston Beer has evolved well beyond its craft beer roots…It is now a publically held beverage company with many brands. And its stock price soared to an all-time high following its record 2Q earnings announcement…

According to the Motley Fool Boston Beer’s blockbuster second quarter results “were boosted by strong sales of the company’s Truly Hard Seltzer and Twisted Tea brands — as well as sales of the Dogfish Head brands it acquired in 2019 — which more than offset declines in its Samuel Adams and Angry Orchard brands.”

“The growth of the Truly brand, led by Truly Hard Lemonade, has accelerated and continues to grow beyond our expectations,” Boston Beer CEO Dave Burwick said in a press release…

 “Since early January, Truly has grown its velocity and its market share sequentially while other national, regional, and local hard seltzer brands have entered the category. Truly is the only hard seltzer, not introduced earlier this year, to grow its share during 2020.”

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