Beer o’clock
Sudsy saga at Boston Beer Company
Good morning, stout slingers. This is your Stock Market Rundown for June 7th, 2024. Thanks for having a tipple with me today. Let’s get into it:
TODAY’S TOP STORY: FRESHLY BREWED
The founder and CEO of Boston Beer Company, Jim Koch, has had quite a week. In fact, now that Friday’s rolled around, I’m guessing at 5 PM sharp he’ll be headed straight to the fridge to crack a cold one. Or six.
The drama kicked off when the Wall Street Journal reported a scoop: Boston Beer was in talks to be acquired. The rumored suitor was Japanese liquor conglomerate Suntory, owner of Jim Beam and Maker’s Mark.
Boston Beer’s stock price has been in a slump, with revenue flat since 2021. Consumers are cutting back on alcohol, and not buying as much Twisted Tea and Angry Orchard Cider.
From the headlines, it seemed like 74-year-old CEO Jim Koch might be ready to close out his tab on running the company. Suntory denied that the companies are in talks—but that doesn’t mean there isn’t some happy-hour haggling behind the scenes.
Meanwhile, another suitor has sprung up. Green Thumb Industries, a US cannabis company, sent Boston Beer a letter offering to merge. (Green Thumb’s founder posted the entire letter on Twitter.)
The rationale? Green Thumb would get a US stock exchange listing, and Boston Beer would get to diversify into the fast-growing marijuana market. I’m woozy just thinking about the cannabis-infused edibles and beverages they could develop.
Boston Beer hasn’t responded publicly to Green Thumb’s approach yet. Whatever happens is ultimately Jim Koch’s call—he controls Boston Beer via his ownership of voting rights. We’ll soon find out whether he believes there are synergies between IPAs and indicas.
SO WHAT ELSE IS GOING ON?
OpenAI has signed a deal with newspaper operator News Corp to license their content for training AI models. Kind of like being paid a bonus to train your replacement.
Williams-Sonoma’s business is as bulletproof as their cast-iron pans, with the housewares retailer reporting an earnings beat on strength in bath and outdoor products.
Gap raised its annual sales forecast as its style bets resonated with shoppers. Yes, white jeans are trending, but you might want to skip the Bolognese Tagliatelle… or have a Tide Pen handy.
Department store Kohl’s stock plunged as management slashed sales forecasts on weakened customer demand for apparel and footwear. Not too surprised… I think the last time I was in a Kohl’s I saw a tumbleweed roll by.
That’s it for the week, my wonderful readers. Have yourselves a terrific weekend, and I’ll look forward to seeing you again Monday morning. Yours in capitalism, The Axe
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