TAP doubled its market share in the seltzer category last year
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Alcohol behemoth Molson Coors Beverage Company (NYSE:TAP) suffered a prolonged downtrend from mid-2016 until last September, when the equity hit an 11-year low of $32.11. Since, TAP has been in rapid recovery mode, now up 29% in 2021, recently experiencing a series of higher highs and lows, with potential for a trend change. For even more peace of mind, Molson is an established brand that is fundamentally sound, trading at 13 times its forward earnings and 1.2 times its sales.
It’s no surprise breweries had taken the food and beverage industry by storm pre-pandemic, but outside businesses have managed to mostly adapt to the new environment. For Molson Coors Beverage, the company doubled its market share in the seltzer category last year and revealed a new partnership with Coca-Cola (KO) to produce and distribute sparkling water product Topo Chico. With restaurants and the wider economy opening up amid a raising vaccine rate in the U.S., the summertime will more than likely bring a fresh surge in product consumption.
In terms of analyst outlook, TAP looks ripe for upgrades. Specifically, six of the nine brokerage firms in coverage sport a tepid "hold," "sell," or "strong sell" rating on the security. Meanwhile, short interest looks to be building, up nearly 60% year-to-date, rising alongside the shares of TAP. This accounts for 9.4% of the stock’s total available float, and would take short sellers over one week to buy back their bearish bets, at the stock’s average pace of daily trading.