If you want to diversify your portfolio, consider alcohol stocks. Despite the threat of recession, investments in the alcohol sector have been resilient. According to Statista, the market size of alcoholic beverages globally was valued at $1.45 trillion in 2021 and has grown even higher in 2022. This is why most alcohol enthusiasts are investing in alcohol stocks.
With bottles of Whiskey fetching over $1 million at auction, you can also invest in your favorite alcoholic drink companies like a pro investor through the Trade Republic. With such trading platforms, you can also trade CFD and work with other types of assets. Still, investing in alcohol stocks isn’t always straightforward. That’s why we’ll explain how to invest in alcohol stocks and the best stocks to choose from in this article.
What Is Alcohol Stocks
Alcohol stocks are stocks of alcoholic beverage companies that make liquor, wine, and beet. They’re known as sin stocks in the same category as marijuana, gambling, and tobacco stocks. Liquor companies fall into this category because they’re considered immoral or unethical by some people’s standards.
Sin stocks will always be profitable because people tend to drink even more when the stock market tanks during the recession. Alcoholic drinks are considered consumer staples because people will continue purchasing them despite a weak economy. It is also consistent all year long, making it non-cyclical. There are many alcohol companies you can choose from to invest in, and we’ll review the best in this article.
Best Alcohol Stocks to Invest In
Once you decide to invest in alcohol stocks, choosing a platform to invest through is easy. https://brokerschart.es/ does an excellent job compiling the best forex brokers to invest with. However, choosing the right company to invest in is essential before you begin. Below, we’ve curated a list of the best companies to invest with; let’s take a look.
- Constellation Brand
This is a beer, spirits, and wine producer in New York; they’re known to be one of the biggest alcohol companies in North America. Constellation Brands have over a hundred brands in its portfolio, including leading brands like Opus One, Robert Mondavi, Clos du Bois, and Robert Mondavi.
Constellation Brands also own beer brands like Pacifico, Corona, and Modelo Especial and popular brands in the alcoholic beverage industry like Casa Noble Tequila and Svedka Vodka.
- Diageo
Diageo’s headquarters is in London, but its reach goes far beyond Europe. It is the world’s largest liquor distributor and second-largest distiller. The company is in over 189 countries and has more than 140 sites.
Some popular brands of the company include Captain Morgan, Crown Royal, Johnnie Walker, Baileys, and Ketel One. Although the company was once involved in food operations, it sold its food operations in 2000. In addition, the brand’s spirits and beer portfolio appeals to emerging and developing markets.
The company has consistently grown in revenue, leading to a growing stock price. This was evident in the first half of 2022, when the brand had a net profit of $1.28 billion.
- Brown Forman Corporation
Brown Forman is a wine and spirits company with stores in over 170 countries. The company has an extensive product portfolio covering tequila, whisky, and vodka. Some of the company’s famous brands include Woodford Reserve, Finlandia, Herradura, and its flagship brand, Jack Daniel’s.
Brown Forman offers investors an impressive track record of revenue growth for over three decades. This is due to the brand’s strong values and resilience in recessions. Moreover, unlike slow-growing companies in the alcohol industry, Brown Forman’s growth forecast for the next few years is optimistic.
- Pernod Ricard
Pernod Ricard is a French spirit and wine company famous for its aperitifs, Ricard Pastis and Pernod Anise. Pernod Ricard is the world’s third-largest liquor and wine seller and has grown by 20% in the third quarter of this fiscal year.
Pernod Ricard has a growing selection of brands that cater to diverse consumers. Names like Jameson, Chivas Regal, and Seagram are part of the company’s portfolio, ensuring the company appeals to a broad market.
Investing in Alcohol Stocks
There’s no better time to invest in alcohol than now. Investing in alcohol is an excellent method for investors to diversify their portfolios. In addition, the industry continues to grow, so investing now ensures you don’t get left behind. However, you should know your limits when investing. Besides passion and taste, another factor you need to consider when investing in alcohol stocks is the trading platform.
