The best beverage stocks for 2022 are companies that either produce or sell products related to water, coffee, tea, and other non-alcoholic drinks. If you think this sounds not very interesting, think again. The global market for these beverages is growing as fast as any other food and beverage industry sector. Unfortunately, it is also a market segment that investors tend to overlook. We have identified some of the best beverage stocks for 2022 and beyond. Read on to learn more about our top recommendations.
Ambev
Ambev is a Brazilian-based beverage company. It is the largest beer company in South America and the world’s largest brewer by volume. Ambev has a market capitalization of $43 billion and a price-to-earnings ratio of 14.6. It has delivered a strong performance over the past year, rising 19%. Ambev is expected to report its fiscal 2020 earnings later this month. Analysts expect the company to report a 12% increase in earnings per share year-on-year. We expect Ambev’s earnings growth to continue to accelerate in the near term. Ambev trades at a cheap valuation and offers a high dividend yield of 4.8%. Ambev is a long-term play on emerging markets and their thirst for beer. It is one of the best beverage stocks for 2022.
Brown-Forman
Brown-Forman is a U.S.-based spirits company. It is the parent of Jack Daniel’s, Southern Comfort, Canadian Mist, Herradura tequila, and other brands. Brown-Forman has a market capitalization of $47 billion and a price-to-earnings ratio of 16.1. Its shares have fallen by more than 6% over the past year. The company’s earnings-per-share growth has slowed over the past year. The company is expected to report its fiscal 2020 earnings later this month. We expect Brown-Forman to post a 2% increase in earnings per share year-on-year. The company’s earnings growth has slowed due to rising interest rates and declining profit margins. However, Brown-Forman has a strong brand portfolio and a low valuation. As a result, we expect the company’s earnings growth to accelerate over the next few years. As a result, Brown-Forman is one of the best beverage stocks for 2022.
Diageo
Diageo is a British-based spirits company. The company is one of the world’s largest liquor producers. Diageo has a market capitalization of $77 billion and a price-to-earnings ratio of 17.8. The company’s shares have risen by more than 8% over the past year. Diageo’s earnings growth has slowed over the past year. The company is expected to report its fiscal 2020 earnings later this month. We hope Diageo to write a 10% increase in earnings per share year-on-year. Diageo’s earnings growth has slowed due to rising interest rates and declining profit margins. However, Diageo is a well-established and diversified beverage company. We expect its earnings growth to accelerate over the next few years. As a result, Diageo is one of the best beverage stocks for 2022.
Coca-Cola Europacific Partners
Coca-Cola Europacific Partners is a joint venture between Coca-Cola and Monster Beverage. The company owns and sells non-alcoholic beverages. It is one of the largest beverage companies in Asia. Coca-Cola Europacific Partners has a market capitalization of $13 billion and a price-to-earnings ratio of 22.3. The company’s shares have risen by more than 19% over the past year. Coca-Cola Europacific Partners is expected to report its fiscal 2020 earnings later this month. We expect the company to report a 10% increase in earnings per share year-on-year. The company’s earnings growth has accelerated over the past year due to an expanded product portfolio and higher sales volume. As a result, Coca-Cola Europacific Partners is one of the best beverage stocks for 2022.
Conclusion
Beverage stocks are an essential part of any well-diversified portfolio. The global thirst for non-alcoholic drinks powers their growth. These stocks are also defensively positioned. Investors should consider adding these stocks to their portfolios. They are some of the best beverage stocks for 2022.
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