Budweiser Beats Numbers, Still a Giant Monopoly

Steve Kanaval |

Anheuser-Busch InBev SA (BUD) is so large – at a $200 billion valuation – and encompasses so many brands, that I wonder what happened to all those different brands I used to steal from my Dad’s refrigerator, like Hamms, Hudephol 14k, Schlitz, Olympia, Pabst or Falstaff. I guess they all got sucked up into the giant InBev monopoly like a poor, unsuspecting hop.

Anheuser-Busch InBev brewing company owns 200 beer brands, which include Budweiser, Corona, Stella Artois, Becks, Leffe, Hoegaarden, Bud Light, Skol, Brahma, Antarctica, Quilmes, Victoria, Modelo Especial, Michelob Ultra, Harbin, Sedrin, Klinskoye, Sibirskaya Korona, Chernigivske, Cass, and Jupiler.

An Empire with an Expanding Beer Belly

Anheuser-Busch recently reported its plans to invest $1.5 billion into its US operations with the goal of strengthening the positions of its brand in the US. Their main focus with the investment projects will be on US brewing, agriculture, packaging and distribution. A further breakdown of the total figure shows $850 million going to brewing and packaging expansion projects, $220 million going to product innovation programs, and finally $720 million going towards efficiency improvement efforts.               

The company has already started several projects to achieve the goals they have laid out for their operations in the US. The company invested $150 million in a project to increase the capacity of the company’s Metal Container Corporation facility in St. Louis, in order to boost the production of Bud Light aluminum bottles.

They are so large that I am surprised there are not monopolistic barriers, as they seem to be able to control pricing. If this were the brokerage business, they would be split up into disparate pieces, dismantling this huge behemoth.

I have done some work on the small cap beverage industry, and will be publishing some cool information about investments for smaller players who are poised for growth in the near future. So stay tuned, and stay thirsty.

Steve Kanaval is the author of the upcoming Equities.com's Small-Cap Throwdown, a premium newsletter designed to help investors identify the best small-cap stocks to add to your portfolio and trading ideas to profit off them. The first issue pits the hottest beverage small-cap stocks against each other to find a winner. Sign-up here for a free issue today!

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Companies

Symbol Name Price Change % Volume
BUD Anheuser-Busch Inbev SA Sponsored ADR (Belgium) 103.26 1.87 1.84 2,705,498

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