Dec 13, 2023
Bud Light’s collaboration with transgender social media influencer Dylan Mulvaney earlier this year sparked controversy, leading to a boycott by some beer drinkers.
But not everyone is walking away from the beer brand. For instance, Ultimate Fighting Championship (UFC) CEO Dana White recently urged Americans to continue enjoying Bud Light.
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“If you consider yourself a patriot, you should be drinking gallons of Bud Light,” he said in a recent interview with political commentator Tucker Carlson.
In October, Bud Light’s parent company Anheuser-Busch InBev (BUD) struck a multiyear partnership deal with UFC. Starting Jan. 1, 2024, Bud Light will become the exclusive beer sponsor for the organization.
White reflected on the decision to select this beer brand.
“We had multiple bidders on the table. They were one of them,” he said. “History has shown me, with relationships that I've had with other beer companies … I don't go crazy over the whole patriot thing, but I consider myself a proud American. I'm happy to be an American. I love this country, and you are way more aligned with Anheuser-Busch than you are with other beer companies, that I guarantee you.”
Will BUD stock make a comeback?
Anheuser-Busch InBev shares have experienced a wild ride this year.
Following Mulvaney’s promotion of Bud Light on social media on April 1, BUD stock dropped 20% over two months, wiping out billions of dollars in market cap.
However, starting from late October, the stock began to climb back up. Trading at $62.05 apiece, Anheuser-Busch shares are actually up around 4% this year.
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The company’s business performance has also shown positive signs. In the third quarter of 2023, Anheuser-Busch’s revenue grew 5% year over year to $15.6 billion. Notably, the company delivered revenue growth in approximately 80% of its markets.
When asked about the Bud Light PR crisis during the earnings conference call, CEO Michel Doukeris informed analysts that, according to the company’s latest research, 40% of “lapsed buyers” indicate they are ready to come back and “open to drink Bud Light again.”
“This gives us some certainty that we are moving in the right direction,” he remarked.
Some Wall Street experts also appear to be bullish on the stock.
For instance, JP Morgan analyst Celine Pannuti has an “overweight” rating on Anheuser-Busch and a price target of $79, implying a potential upside of around 27% from where the stock sits today.
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Jing is an investment reporter for MoneyWise. He is an avid advocate of investing for passive income. Despite the ups and downs he’s been through with the markets, Jing believes that you can generate a steadily increasing income stream by investing in high quality companies.
