Big beer companies, including those that brew Coors, Sam Adams and Corona, recently took a sizable hit in the stock market because millennials are "shifting away from beer," according to a Goldman Sachs analyst.
"...We expected a cyclical rebound in total alcohol consumption post-recession ," wrote chief analyst Freda Zhuo in a note obtained by CNBC. "The cause [for shifts in beer and wine market penetration] is younger groups shifting away from beer."
The New York Post has further details:
Constellation’s 12-month share price target was cut to $210 by Goldman.Boston Beer, the maker of Sam Adams, saw its shares fall 5 percent, to $130.50, while Constellation Brands, the maker of Corona, slipped 1.3 percent, to $196.00. Goldman lowered its 12-month price target for Boston Beer, to $110 from $140 — 15 percent below Monday’s close.
According to CNBC, the Goldman report indicates that millennials aren't consuming as much alcohol as their parents, and when they do, they appear to prefer wine and spirits over beer.
"We view the shift in penetration and consumption trends as driven by a shift in preferences in the younger cohorts," added Zhuo.
"The youngest demographic (<35 year olds) overall penetration rates are not increasing. The 35-44 year old cohort shows a shift away from Beer to Wine & Spirits."
Molson Coors, which makes Miller and Coors beer, also recently had their rating adjusted by the Cowen Financial Group because of a "notable inverse correlation" between increasing marijuana use and decreasing alcohol consumption during the last three cycles.
Even sales of craft beer, which are expected to rise by 2.5 percent this year, appears to be slowing when compared to the 17.9 percent growth the industry saw in 2011.
It looks like it may be time to invest in marijuana stocks.