Boston Beer Company (SAM) just jumped into a new multi-year high, surging more than 13% in one day after reporting another strong quarter. With four consecutive earnings surprises and a bullish 28% growth projection, this Zacks #1 Rank stock is brewing with momentum.
Company Description
The Boston Beer Company, Inc, brews and sells alcohol beverages in the United States and internationally. The company was founded in 1964 and has a market cap of $1.27 billion.
SAM got a nice boost into a new multi-year high on Nov 1 after reporting strong Q3 results that came in ahead of expectations.
Third-Quarter Results
Revenue for the period was up 8% from last year to $135 million. Earnings also came in strong at 84 cents, one penny ahead of the Zacks Consensus Estimate, where the company has an average earnings surprise of 19% over the last four quarters.
The company has been focused on increasing freshness through reducing inventories, driving depletions up 11% during the quarter. Gross margin also increased to 56% from 55% last year.
Financial Profile
Boston Beer will continue to benefit from its strong financial profile, with cash and short-term investments holding mostly steady from last year at $48 million against no long-term debt.
Estimates
We saw some decent movement in estimates off the good quarter, with the current year up 3 cents to $1.84. The next-year estimate gained 8 cents to $2.35, a bullish 28% growth projection.
But in spite of the gains, the valuation picture still looks solid, with a PEG ratio of 1 in line with the benchmark for value.
6-Month Chart
On the chart, shares blasted higher into a new multi-year high on the good quarter. Look for support from the long-term trend on any weakness. Take a look below.
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Michael Vodicka is the Momentum Stock Strategist for Zacks.com. He is also the Editor in charge of the market-beating Zacks Whisper Trader Service.
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