Millennials became the largest demographic in North America in the middle of this decade. Companies have dedicated fortunes to come to understand and market to this demographic, but key trends may be worrying some industries.
Alcohol consumption among millennials is low in comparison to their older peers, and rates are even lower among Generation Z. Beer has lost significant ground in these demographics, while wine is the most popular alcoholic beverage in the millennial generation. These trends could have huge consequences for the wine, spirits, and beer industry going forward.
Anheuser-Busch (NYSE:BUD) is the largest brewer in the world. The company’s portfolio includes five of the top 10 beer companies globally. The stock has plunged 24.8% in 2018 as of close on October 19.
A marketing push during the World Cup hurt its year-over-year profit growth. Shares are now down 18% over a five-year period. The stock does offer a tasty 5% dividend, but weakness in the beer market means there are better options elsewhere.
Constellation Brands (NYSE:STZ) is a New York-based producer of wine, beer, and spirits. The company has also recently invested in the Canadian cannabis industry. It is worth noting that millennials have posted high cannabis consumption rates with some speculation that it could impinge on the alcohol market going forward. Constellation stock is up 5.5% year-over-year and is still worth a look today.
Truett-Hurst (NASDAQ:THST) is an interesting nano-cap for those interested in investing in this California-based wine producer. It operates through its direct-to-consumer division which is another boon for younger consumers who are more attuned to shop through e-commerce platforms.
