Athletic Brewing raises $50 million as nonalcoholic wave sweeps beer making
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jul 09 2024
0mins
Source: CNBC
- Athletic Brewing Company Funding: Athletic Brewing Company raised $50 million in equity financing led by General Atlantic, with plans for further investment.
- Company Growth and Market Share: Despite offering only nonalcoholic options, Athletic Brewing is the 10th largest U.S. craft brewery and holds over 19% market share within nonalcoholic beer.
- Revenue and Valuation: The company's revenue has more than doubled since its Series D funding round, and its valuation has now reached $800 million.
- Expansion Plans: Athletic Brewing plans to use the latest investment to increase production capacity, expand offerings at global retailers, and double its U.S. brewing capacity with a new facility in San Diego.
- Consumer Trends: The success of nonalcoholic beverages like those offered by Athletic Brewing is attributed to growing health and wellness trends, with more Americans, especially millennials and Generation Z, actively trying to drink less alcohol.
Trade with 70% Backtested Accuracy
Stop guessing "Should I Buy DEO?" and start using high-conviction signals backed by rigorous historical data.
Sign up today to access powerful investing tools and make smarter, data-driven decisions.
Analyst Views on DEO
Wall Street analysts forecast DEO stock price to fall
2 Analyst Rating
1 Buy
1 Hold
0 Sell
Moderate Buy
Current: 78.940
Low
25.32
Averages
76.16
High
127.00
Current: 78.940
Low
25.32
Averages
76.16
High
127.00
About DEO
Diageo plc is a United Kingdom-based international manufacturer and distributor of premium drinks. The Company offers beverage alcohol with a collection of brands across spirits and beer categories. Its segments include North America, Europe, Asia Pacific, Latin America and Caribbean, Africa, and Corporate and other. The SC&P segment manufactures products and includes production sites in the United Kingdom, Ireland, Italy, Guatemala and Mexico, as well as comprises the global procurement function. Its principal products include scotch whisky, whisk(e)y, vodka, tequila, gin, rum, liqueurs, beer, wine, and non-alcoholic spirits. Its collection of brands includes Johnnie Walker, J&B and Buchanan's whiskies, Smirnoff, Ciroc and Ketel One vodkas, Captain Morgan, Don Julio, Guinness, and Tanqueray, among others. It offers Ritual Zero Proof Non-Alcoholic Spirits (Ritual). It owns manufacturing production facilities across the globe, including distilleries, breweries, and packaging plants.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Investment Analysis in the Spirits Industry
- Intensifying Market Competition: Diageo sells over 200 brands globally, with FY 2025 revenue nearing $20.2 billion, reflecting a slight 0.1% decline from the previous year, yet its presence in nearly 180 countries underscores strong brand influence, though it faces pressure from competitors like Pernod Ricard and LVMH.
- Financial Performance Comparison: Brown-Forman reported total revenue of approximately $4.0 billion in FY 2025, a 4.9% decrease year-over-year, but net income was around $869 million, achieving a net margin of 21.9%, indicating profitability despite high customer concentration risks.
- Valuation Discrepancies: Diageo's forward P/E stands at 17.0x compared to Brown-Forman's 15.2x; while the latter has a higher P/S ratio of 3.0x, Diageo's substantial total revenue enhances its attractiveness in the market, reflecting differing investment values.
- Changing Consumer Trends: Gallup's survey shows that the percentage of U.S. adults drinking alcohol fell to 54% in 2025, with younger demographics showing reduced interest, leading to stock declines of 64% and 69% for Diageo and Brown-Forman respectively over the past five years, placing both companies at decade-low valuations, necessitating cautious evaluation of future growth potential.
See More
Value Proposition Analysis of Spirits Giants
- Market Performance Comparison: Diageo's revenue for FY 2025 reached nearly $20.2 billion, reflecting a slight decline of 0.1% from the previous year, yet its net income stood at approximately $2.4 billion, showcasing its strong global market influence; in contrast, Brown-Forman reported total revenue of about $4.0 billion, a 4.9% decrease, but net income of $869 million with a net margin of 21.9%, indicating robust profitability.
- Financial Health Status: Diageo's debt-to-equity ratio is 2.2x with a current ratio of approximately 1.6, demonstrating solid short-term debt coverage; conversely, Brown-Forman's debt-to-equity ratio is only 0.7x, with a current ratio of 3.9, indicating a stronger financial position to handle short-term obligations.
- Consumer Trend Impact: With the percentage of U.S. adults drinking alcohol dropping to 54%, and a significant decline in interest among younger consumers, Diageo and Brown-Forman's shares have fallen by 64% and 69% over the past five years, reflecting the challenges faced by the industry and investor caution.
- Future Outlook and Investment Strategy: Despite both companies trading at decade-low valuations, Diageo's international sales advantage and a 4.2% dividend yield may position it better for future market recovery, prompting investors to monitor its upcoming earnings for signs of improvement and potential acquisition opportunities.
See More
Top Consumer Brands Offer Attractive Dividend Yields Amid Market Weakness
- Home Depot Investment Opportunity: Home Depot's shares are currently trading 29% below their previous high, and despite sales growth being pressured by high interest rates, its quarterly dividend of $2.33 per share yields 2.98%, significantly above the S&P 500 average, indicating strong investment value during economic recovery.
- Hershey's Steady Growth: Hershey's stock has also declined by 29%, yet its first-quarter organic sales grew nearly 8% year-over-year, with adjusted earnings rising 12%, demonstrating the resilience of its brand portfolio and suggesting continued stable growth in the coming years.
- Diageo's High Yield: Diageo offers a dividend yield of 3.88%, and although its stock is down 61% from its peak, its organic net sales increased by 0.3% year-over-year, showcasing the value of its diversified brand portfolio, with future potential to enhance free cash flow supporting dividend payments.
- Market Dynamics Analysis: While macroeconomic pressures have impacted consumer brand stock prices, the current low prices make these companies' dividend yields particularly attractive for income-seeking investors, especially in the context of an anticipated economic recovery.
See More
Top Dividend Stocks to Buy Amid Market Weakness
- Home Depot Investment Opportunity: Home Depot's stock is currently 29% below its historical high, and despite sales growth being pressured by high interest rates, its quarterly dividend of $2.33 per share, equating to an annual yield of 2.98%, significantly exceeds the S&P 500 average, indicating strong investment potential as the economy rebounds.
- Hershey's Brand Resilience: Hershey's stock has fallen 29% due to rising cocoa prices and the impact of weight-loss drugs on consumers, yet its brand portfolio remains robust, with organic sales growing nearly 8% year-over-year in Q1 and adjusted earnings up 12%, showcasing its sustained growth potential in the $146 billion global confectionery market.
- Diageo's High Yield: Diageo offers a dividend yield of 3.88%, having paid out 91% of its free cash flow over the past year, but its strong portfolio in beer and spirits provides pricing power, with organic net sales increasing 0.3% year-over-year last quarter, highlighting the value of its diversified brand portfolio.
- Optimistic Market Outlook: With cocoa prices easing and Hershey's margins set to improve, its forward yield of 3% appears particularly attractive, while Diageo aims to boost free cash flow to $3 billion, indicating strong long-term potential for investing in these high-yield dividend stocks.
See More
Greg Abel's First Quarter Report Reveals Investment Strategy
- Portfolio Adjustments: In his first quarterly report, Abel adjusted the $330 billion equity portfolio by adding positions in Delta Airlines and Macy's, while tripling the stake in Alphabet, indicating his proactive approach to high-conviction stocks while maintaining Buffett's investment style.
- Small Position Sell-Off: In the first quarter, Abel and his team sold out of 16 smaller positions, including Visa and Mastercard, which accounted for about a third of Berkshire's total holdings, demonstrating decisive action in optimizing the investment portfolio.
- Core Holdings Retained: Despite the significant sell-off, Abel retained core holdings such as Apple, American Express, and Coca-Cola, reflecting his respect for and continuation of the company's traditional investment strategies established by Buffett.
- Positive Market Reaction: Following the announcement of Abel's investment strategy, Berkshire Hathaway's stock ticked higher, reflecting market confidence in his management capabilities and further solidifying the company's position in the investment community.
See More
Berkshire Hathaway's Abel Restructures Equity Portfolio
- Portfolio Restructuring: Greg Abel cut 16 small positions in the first quarter, including long-held Visa and Mastercard, demonstrating a strategic focus on concentrated high-conviction stocks while maintaining Buffett's traditional investment style.
- New Investment Directions: Abel added positions in Delta Airlines and Macy's, and tripled the investment in Alphabet, indicating a strategy aligned with Buffett's tech stock preferences, which may attract younger investors.
- Increased Concentration: Excluding investments in Japan, Berkshire now holds only 29 positions, retaining Buffett favorites like Apple, American Express, and Coca-Cola, reflecting ongoing confidence in classic quality assets.
- Positive Market Reaction: Despite the reduction of about one-third of the portfolio, Berkshire's stock price rose following the announcement, indicating market approval of Abel's investment strategy and suggesting optimistic expectations for future performance.
See More
Investment Analysis in the Spirits Industry
- Intensifying Market Competition: Diageo sells over 200 brands globally, with FY 2025 revenue nearing $20.2 billion, reflecting a slight 0.1% decline from the previous year, yet its presence in nearly 180 countries underscores strong brand influence, though it faces pressure from competitors like Pernod Ricard and LVMH.
- Financial Performance Comparison: Brown-Forman reported total revenue of approximately $4.0 billion in FY 2025, a 4.9% decrease year-over-year, but net income was around $869 million, achieving a net margin of 21.9%, indicating profitability despite high customer concentration risks.
- Valuation Discrepancies: Diageo's forward P/E stands at 17.0x compared to Brown-Forman's 15.2x; while the latter has a higher P/S ratio of 3.0x, Diageo's substantial total revenue enhances its attractiveness in the market, reflecting differing investment values.
- Changing Consumer Trends: Gallup's survey shows that the percentage of U.S. adults drinking alcohol fell to 54% in 2025, with younger demographics showing reduced interest, leading to stock declines of 64% and 69% for Diageo and Brown-Forman respectively over the past five years, placing both companies at decade-low valuations, necessitating cautious evaluation of future growth potential.
See More
Value Proposition Analysis of Spirits Giants
- Market Performance Comparison: Diageo's revenue for FY 2025 reached nearly $20.2 billion, reflecting a slight decline of 0.1% from the previous year, yet its net income stood at approximately $2.4 billion, showcasing its strong global market influence; in contrast, Brown-Forman reported total revenue of about $4.0 billion, a 4.9% decrease, but net income of $869 million with a net margin of 21.9%, indicating robust profitability.
- Financial Health Status: Diageo's debt-to-equity ratio is 2.2x with a current ratio of approximately 1.6, demonstrating solid short-term debt coverage; conversely, Brown-Forman's debt-to-equity ratio is only 0.7x, with a current ratio of 3.9, indicating a stronger financial position to handle short-term obligations.
- Consumer Trend Impact: With the percentage of U.S. adults drinking alcohol dropping to 54%, and a significant decline in interest among younger consumers, Diageo and Brown-Forman's shares have fallen by 64% and 69% over the past five years, reflecting the challenges faced by the industry and investor caution.
- Future Outlook and Investment Strategy: Despite both companies trading at decade-low valuations, Diageo's international sales advantage and a 4.2% dividend yield may position it better for future market recovery, prompting investors to monitor its upcoming earnings for signs of improvement and potential acquisition opportunities.
See More
Top Consumer Brands Offer Attractive Dividend Yields Amid Market Weakness
- Home Depot Investment Opportunity: Home Depot's shares are currently trading 29% below their previous high, and despite sales growth being pressured by high interest rates, its quarterly dividend of $2.33 per share yields 2.98%, significantly above the S&P 500 average, indicating strong investment value during economic recovery.
- Hershey's Steady Growth: Hershey's stock has also declined by 29%, yet its first-quarter organic sales grew nearly 8% year-over-year, with adjusted earnings rising 12%, demonstrating the resilience of its brand portfolio and suggesting continued stable growth in the coming years.
- Diageo's High Yield: Diageo offers a dividend yield of 3.88%, and although its stock is down 61% from its peak, its organic net sales increased by 0.3% year-over-year, showcasing the value of its diversified brand portfolio, with future potential to enhance free cash flow supporting dividend payments.
- Market Dynamics Analysis: While macroeconomic pressures have impacted consumer brand stock prices, the current low prices make these companies' dividend yields particularly attractive for income-seeking investors, especially in the context of an anticipated economic recovery.
See More
Top Dividend Stocks to Buy Amid Market Weakness
- Home Depot Investment Opportunity: Home Depot's stock is currently 29% below its historical high, and despite sales growth being pressured by high interest rates, its quarterly dividend of $2.33 per share, equating to an annual yield of 2.98%, significantly exceeds the S&P 500 average, indicating strong investment potential as the economy rebounds.
- Hershey's Brand Resilience: Hershey's stock has fallen 29% due to rising cocoa prices and the impact of weight-loss drugs on consumers, yet its brand portfolio remains robust, with organic sales growing nearly 8% year-over-year in Q1 and adjusted earnings up 12%, showcasing its sustained growth potential in the $146 billion global confectionery market.
- Diageo's High Yield: Diageo offers a dividend yield of 3.88%, having paid out 91% of its free cash flow over the past year, but its strong portfolio in beer and spirits provides pricing power, with organic net sales increasing 0.3% year-over-year last quarter, highlighting the value of its diversified brand portfolio.
- Optimistic Market Outlook: With cocoa prices easing and Hershey's margins set to improve, its forward yield of 3% appears particularly attractive, while Diageo aims to boost free cash flow to $3 billion, indicating strong long-term potential for investing in these high-yield dividend stocks.
See More
Greg Abel's First Quarter Report Reveals Investment Strategy
- Portfolio Adjustments: In his first quarterly report, Abel adjusted the $330 billion equity portfolio by adding positions in Delta Airlines and Macy's, while tripling the stake in Alphabet, indicating his proactive approach to high-conviction stocks while maintaining Buffett's investment style.
- Small Position Sell-Off: In the first quarter, Abel and his team sold out of 16 smaller positions, including Visa and Mastercard, which accounted for about a third of Berkshire's total holdings, demonstrating decisive action in optimizing the investment portfolio.
- Core Holdings Retained: Despite the significant sell-off, Abel retained core holdings such as Apple, American Express, and Coca-Cola, reflecting his respect for and continuation of the company's traditional investment strategies established by Buffett.
- Positive Market Reaction: Following the announcement of Abel's investment strategy, Berkshire Hathaway's stock ticked higher, reflecting market confidence in his management capabilities and further solidifying the company's position in the investment community.
See More
Berkshire Hathaway's Abel Restructures Equity Portfolio
- Portfolio Restructuring: Greg Abel cut 16 small positions in the first quarter, including long-held Visa and Mastercard, demonstrating a strategic focus on concentrated high-conviction stocks while maintaining Buffett's traditional investment style.
- New Investment Directions: Abel added positions in Delta Airlines and Macy's, and tripled the investment in Alphabet, indicating a strategy aligned with Buffett's tech stock preferences, which may attract younger investors.
- Increased Concentration: Excluding investments in Japan, Berkshire now holds only 29 positions, retaining Buffett favorites like Apple, American Express, and Coca-Cola, reflecting ongoing confidence in classic quality assets.
- Positive Market Reaction: Despite the reduction of about one-third of the portfolio, Berkshire's stock price rose following the announcement, indicating market approval of Abel's investment strategy and suggesting optimistic expectations for future performance.
See More
