Boston Beer shares rose over 18% to a new all-time high on Friday, the day after the maker of Samuel Adams and Truly Hard Seltzer reported third-quarter gains and raised forecasts.
The stock closed Friday's session at $ 1,091 apiece, adding to its 2020 uptrend so far. Boston Beer stocks are up nearly 190% since the start of the year.
The company posted third-quarter earnings per share of $ 6.51 on Thursday, beating Wall Street projections of $ 4.63, according to FactSet. Revenue of $ 492.8 million was an increase of 30% over the prior-year quarter, but fell short of analysts' expectations of $ 519.5 million.
Boston Beer forecast its strong momentum to continue into the fourth quarter and next year, and raised forecasts accordingly. The company now expects shipments and impoverishment, which measures the products sold by merchants to retailers, to increase between 37% and 42% in 2020. Earlier forecasts assume an increase of between 27% and 35%.
The strength of the Hard Seltzer brand Really so far this year has been the main driver behind the increased prospects, the company's President and CEO Dave Burwick said in a press release.
"It really is the only one of the leading selters to actually win shares this year, which I believe is due in part to very successful innovations," said Jim Koch, co-founder and chairman of Boston Beer, on CNBC's "Closing Bell." "We launched the first hard Seltzer lemonade that has a lot of flavor. It improved the taste game a bit, so we actually have a larger share, despite the addition of dozens of competitors."
Boston Beer also predicts shipments and impoverishment growth between 35% and 45% in 2021. According to analysts at Jefferies, this was above Wall Street's forecast of an increase of around 30%.
Analysts, who have a target price of $ 575 on the stock, said in a note that they are maintaining their underperformance and their beliefs are "valued for perfection" due to competitive risks in the fiery tough seltzer category.
Deutsche Bank analysts maintained their hold rating on Boston Beer stock, but raised their price target from $ 835 to $ 996. In a statement to customers, the analysts described the company's quarter as "relatively mixed" and found that sales were lower than expected.
However, they said that management's bullish projections supported higher earnings in 2021. They also expect margins to improve as the pressures from the coronavirus pandemic ease.
– CNBC's Michael Bloom contributed to this report.