3 Top Beer Stocks to Buy in 2017 – Madison.com

Consolidation continues to reduce the number of brewers in the beer market while roiling those who remain. Boston Beer (NYSE: SAM) founder and chairman Jim Koch, who recently penned an op-ed bemoaning a lack of industry oversight and regulation by the government.

We can understand the craft brewer’s frustration, as sales of his flagship Samuel Adams brand continue to slide and he’s looking for someone to blame, but as investors we’re tasked with dealing with the market as it is and finding great companies to invest in. So let’s look at why Constellation Brands (NYSE: STZ), Heineken (NASDAQOTH: HEINY), and Molson Coors (NYSE: TAP) may be the best investments in brewing.

Image source: Modelo USA.

Constellation Brands

A premier wine and spirits distributor, but one with a beer chaser, Constellation Brands’ acquisition from Anheuser-Busch InBev (NYSE: BUD) in 2013 of Crown Imports and its U.S. rights to Grupo Modelo’s portfolio of Corona, Modelo, and Pacifico beers tilted the field in favor of it becoming a major brewer. Beer now accounts for 55% of its revenue. It recently added Mexico’s Obregon brewery as well.

The acquisitions came at just the right time, too, because drinkers searching for a different taste beyond mass-produced beers and even craft brews have hit on imports in a big way. According to industry site BevNet, the market researchers at Nielsen say off-premise sales of imported beer rose 6.8% last year while dollar sales were up 9.1%, as almost all Mexican beers showed strong growth.

Constellation just reported its fiscal year 2017 results and pointed to the 17% increase in beer sales, 13% of it from organic growth, as the reason for its record results. President and CEO Rob Sands said, “Our

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