Boston Beer: Citigroup Lowers PT to $230 from $285, Maintains Buy Rating

Boston Beer: Citigroup Lowers PT to $230 from $285, Maintains Buy Rating

Citigroup has revised its price target for Boston Beer Company (NYSE: SAM) to $230, down from the previous target of $285. Despite this reduction, the investment bank maintains a Buy rating on the stock. Currently, Boston Beer is trading at $192.55, down 36% year-to-date and near its 52-week low of $185.34 [1].

The price target reduction reflects Citi's expectation of soft second-quarter 2025 results, with shipments and depletions estimates revised downward to -6.5% and -7.5% year-over-year, respectively. Analysts are closely watching the company's earnings report, scheduled for July 24, with 7 analysts having recently revised their earnings expectations downward [1].

Citi attributes the price target reduction to significant weakness in Boston Beer's Twisted Tea and Truly brands, which was only partially offset by the rollout of Sun Cruiser. Scanner volume trends for Boston Beer have sharply decelerated by approximately 500 basis points in the 10 weeks following the company’s first-quarter earnings call [1].

Boston Beer reported a strong Q1 2025 performance, with earnings per share (EPS) of $2.16, significantly surpassing the forecasted $0.6342, and a 6.5% increase in revenue. However, the company faces challenges from Goldman Sachs, which maintains a Sell rating and has lowered shipment, depletion, and earnings estimates for upcoming quarters [1].

Despite these challenges, Boston Beer has expanded its cannabis beverage lines, TeaPot and Emerald Hour, in Canada, introducing new high-potency offerings. These strategic initiatives aim to diversify the company's portfolio and explore emerging consumer trends [1].

Analysts have mixed views on Boston Beer's stock. While Citi and UBS have raised their price targets, Goldman Sachs and CFRA have maintained their Sell ratings. The overall analyst consensus is a Hold rating, with an average 12-month price target of $250.41 [2].

Investors will be closely monitoring Boston Beer's upcoming quarterly reports to assess the impact of these strategic initiatives on the company's performance.

References:
[1] https://www.investing.com/news/analyst-ratings/boston-beer-price-target-lowered-to-230-from-285-at-citi-on-weak-sales-93CH-4136166
[2] https://www.tipranks.com/stocks/sam/forecast