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Investors Are Getting All Liquored Up This Year With Alcohol Stocks; Constellation Brands, Inc. (NYSE:STZ), Diageo plc (ADR) (NYSE:DEO), Iconic Brands Inc (OTCMKTS:ICNB)

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Over the last couple of decades, the vodka industry has worked very diligently to make itself a successful subset of a much more vast alcohol industry. But vodka sales have been a growing portion of the alcohol industry over more recent years. Although international preferences have been changing, vodka has been at the top of consumers’ lists when it comes to staple “adult beverages”. In the United States, the top ten vodka brands saw revenue growth of 2% in 2014. It is evident that vodka is growing and here are a few reasons perhaps to explain why.

Smaller Producers Are Realizing Larger Growth Potential Than ‘The Big Boys’

For one, there are many new companies coming into the market. If there is an industry that sees consistent growth annually, then it is not a surprise to see many new companies entering the market to take advantage of the profitability. While it is true that competition actually works to lower the revenue and market share of bigger vodka companies such as the Smirnoff Vodka brand or Pernod Ricard’s Absolut, these small companies have seen huge success and have attributed to the growth of the overall vodka market as a whole.

Investors Need To Know About ‘The Craft’

Another reason is that there seems to be consumer preferences over craft cocktails as well as craft beers. As a result, many smaller brands have been able to find profits by marketing themselves as premium drinks. This large consumption of craft cocktails and spirits have led to a continuous growth in the vodka industry. For instance, flavored vodkas have been extremely successful over the last two years. This intake of flavored vodka has helped the industry grow in the last two years. These craft products have found themselves popular among millennials, who keep the vodka industry a fresh product in the mind of the market.  Outside of flavors, the overall craft segment is drawing much more attention.  Bloomberg Business reported that American millennials are fleeing to smaller, craft brands, and the world’s largest vodka producers are actually struggling to retain market share.

And it’s not just the brands themselves that are helping to buck the trend. Smaller producers are winning the battle when it comes to “thinking outside the box,” or more specifically, the bottle design.  Affinnova, Inc., a global marketing technology company, found that with unique bottle designs, including bold elements and colors, younger brands are becoming more effective at grabbing and holding consumer attention on shelf, dramatically outperforming the industry average. By contrast Smirnoff and Stolichnaya – brands with decades of brand equity – are more likely to be overlooked by consumers on shelf. As an example, Absolut’s bottle design is succeeding in positioning the brand as “fun, friendly and approachable” among consumers 35 and older. However, it’s less effective with 21-34 millennial drinkers.

A brand that may have it all has just hit the us market, BiVi, praised for its one-of-a-kind hand crafted Sicilian vodka has been well received not only for its celebrity endorsement from A Bronx Tale’s Chazz Palminteri but also for the unique bottle design represented by the traditional grappa bottle packaging. Publicly traded under Iconic Brands, Inc. (OTCMKTS:ICNB), BiVi is anticipated to be well received by millennials and vodka aficionados alike. In addition, the new brand entry into the US market could present a very strong opportunity for investors looking to get in on the trend of craft vodka growth. Furthermore it could even present a value proposition for those looking at a “buyout” play with companies like Diageo plc (ADR) (NYSE:DEO) and Constellation Brands, Inc. (NYSE:STZ) in the hunt for a strong hand in this segment.

Vodka Market Growth Has Savvy Investors Planning Their Attack

The intake of vodka and the growth of the industry has always been an international effort. Russia is the country best known for vodka and has always been a high consumer of vodkas. The increase of domestic premium vodkas in Russia helped increase Russian consumption. According to DISCUS, vodka has also made itself a name in the United States spirits industry, counting for 30% of all spirit sales. In the United States, there are over 150 flavors and lines that have been entering the market. As a result, each new product has been experiencing consistent growth. In addition, Canada has also been seeing growth in the vodka market. Vodka has also overtaken whiskey as the biggest spirits volume category in 2010. This has not changed since then. Countries all around the world have been seeing growth and contributing to the overall growth of the vodka industry.

 

 

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Constellation Brands, Inc. (NYSE:STZ), Constellation Brands, Inc., NYSE:STZ, STZ, Diageo plc (ADR) (NYSE:DEO), Diageo plc (ADR), NYSE:DEO, DEO, Iconic Brands Inc (OTCMKTS:ICNB), Iconic Brands Inc, OTCMKTS:ICNB, ICNB

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Biotech

CytoDyn Inc (OTCMKTS:CYDY) Regains Momentum After The Big Announcement

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Now that the market seems to be coming back into his elements, it could be time for investors to start looking into penny stocks more closely. These stocks may often be risky, but if one makes the right choice, then the rewards could be enormous. One penny stock that could be put into the watch list at this point in time is that of CytoDyn Inc (OTCMKTS:CYDY).

The late-stage biotechnology company, which is developing the coronavirus medicine leronlimab, announced last week that it had filed a comprehensive application for uplisting on NASDAQ. The company announced that it believes that its application satisfies the myriad listing requirements of the NASDAQ Capital Market.

The Chief Executive Officer and President of the company Nader Pourhassan stated that while it is true that the entire process is expected to take many weeks, CytoDyn is hopeful of success in this matter.

He went on to state that a listing on NASDAQ will not only provide shareholders with more liquidity but also give CytoDyn much bigger access to fresh capital. It is a significant development for the company, and the market participants realized it as well. After the announcement was made, the stock rallied by as much as 50%. Investors could do well to keep an eye on the stock this week.

While the rally following this announcement was a welcome relief for the company, it is important to point out that earlier on in the week, the stock has fallen considerably following a setback. Last Monday, the company announced that the United States Food and Drug Administration handed CytoDyn a refusal to file a letter with regards to the usage of leronlimab to treat HIV.

However, at the same time, investors should be noted that the company did announce that it is confident of furnishing the agency with all the further details that have been demanded. It is one of the penny stocks that have performed remarkably well this year so far, and investors could keep an eye on it.

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Market

These 3 Pot Stocks Are Up Big Since May: What’s the Buzz?

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Over the course of the past year or so, pot stocks had generally struggled, but during the past month, those stocks have recovered nicely. The stock market suffered a historic fall due to the economic turmoil caused by the coronavirus pandemic. It is believed that investors who are looking for value have descended on the beaten-down pot stocks. On the flip side, these stocks could also have been identified as defensive plays in an uncertain market environment.

That being said, it should be noted that despite the gains recorded by many stocks, most of those stocks are still considerably lower than the all-time highs. In such a situation, it could be worthwhile for investors to take a closer look at some of the strongest and more stable cannabis companies in the industry. Here is a look at three pot stocks that made significant moves in May and could be tracked by investors at this point.

1. HEXO Stock Jumps Ahead of Earnings

HEXO Corp (TSX:HEXO) (NYSE:HEXO) is one of those cannabis companies which have had a particularly tough time over the past year or so. However, the stock has emerged as one of the bigger gainers among pot stocks in recent trading sessions. The Hexo stock has gained as much as 120% over the course of the past month. The company is all set to release its financial results for the fiscal third quarter on Thursday, and hence, it could be a big week for the stock.

The recent surge in the Hexo stock may have come as a major boost to investors, but it should be noted that over the past year, it recorded considerable losses. The beaten-down nature of the stock may have contributed to the stock becoming more attractive for investors. However, the trajectory of the Hexo stock in the near term is going to depend a lot on its third-quarter earnings.

The company had made a loss of $298 million in the previous quarter, and while it is almost certain that it is going to make a loss again, the size of the loss is going to be keenly watched. Additionally, any writedowns are also going to be harmful to the stock. Investors should also keep an eye on sales growth.

2 Organigram gains Momentum on Value Buying

Organigram Holdings (TSX:OGI) (NASDAQ:OGI) is another pot stock that has made significant gains in the past month. Since May 13, the stock has gained as much as 80%. In April, the company announced its fiscal second-quarter results, but it had been a disappointment.

Revenues dropped by 13.7% year on year to hit CA$23.2 million, and losses widened to CA$6.8 million from CA$6.4 million in the prior-year period. However, one significant cause for optimism for Organigram investors is the fact that in the second quarter, cannabis 2.0 products made up as much as 13% of its revenue. That has opened up a whole new opportunity for the company.

Wholesale cannabis revenue made up 24% of the net, and that is again a new source of revenue. The company blamed the lower volumes of flower as well as cannabis oil for the drop in sales. Organigram reported cash and cash equivalents of CA$41.1 million as of February 29. Considering the fact that it has burned CA$25 million in the past six months, investors should not use that the cash balance does not paint a pretty picture.

3 Aphria Recovers Following Solid Earnings

Aphria (TSX:APHA) (NYSE:APHA), on the other hand, managed to perform relatively well in its fiscal third quarter. The net sales rose by as much as 19.7% sequentially to hit CA$144.4 million, and more importantly, the company also managed to record a profit for the third time in four quarters. On top of that, it should be noted that although the Canadian cannabis company spends CA$124.4 million on its operations in the nine months trailing that quarter, it still reported a cash balance of CA$515 million.

The performance seems to have buoyed market participants as well, and the stock has rallied by as much as 75% since the middle of May. One of the most important things that investors are going to be looking into is whether Aphria is going to be able to maintain its profitability.

However, due to the turmoil caused by the coronavirus pandemic, it might prove difficult. That being said, it should be noted that the pandemic is going to have an equally damaging effect across the sector.

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Market

ConforMIS Inc (NASDAQ: CFMS): Premium Members Made A Quick 65% Profit In Just 1 week

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