Molson Coors stock boosted following earnings beat tied to price hikes

The Yahoo Finance Live team discusses the sales growth of Molson Coors on Q1 earnings amid global inflation and highlighted the possibility of consumers preferring Molson Coors products over rival Bud Light due to the Dylan Mulvaney controversy.

Video transcript

- Moving to another consumer facing brand, my pick today is Molson Coors. Shares of the beer company jumped 10% following its first quarterly earnings results that beat estimates. Now this quarter adjusted profit grew by 82.3%. That was boosted by higher prices and a favorable sales mix. Here in the US, its core brands, Coors Light and Miller Lite, saw revenue grow double digits.

Now the company reiterated its 2023 guidance of low single digit sales growth compared to that of 2022. But the CEO did say, "inherent uncertainties still exist with the beer industry softness and the impacts of continued global inflationary cost pressures."

And so many analysts could not help but to ask on the call about any share gains from that current pressure that Bud Light is facing following their partnership with Dylan Mulvaney. Now the CEO said in the call, we haven't factored in any of the trends that we've seen in April into our guidance, and we really, and I'm sure nobody has any idea about how long these sort of trends are going to continue. So we emphasize that they are not factored into our guidance at this point.

He went on later on, as many analysts asked about this share gains, potential opportunity of investments here, to say that they're focused on their brands as of now.

- Yeah, Brooke. I mean, I know you've been looking at the impact of inflation, especially among food, as well as beverages here. I mean, you'd imagine that's kind of where it's been really sticky. That's sort of the additional extra spending, right, when you think about where they compete in terms of the marketplace. But interesting to see just where the market is moving on that front, Seana.

SEANA SMITH: Yeah, where the market is moving and how much Molson Coors is really going to be able to capitalize on the fact that Bud Light is losing market share, with the latest out of that we've found out from a number of the industry groups really showing that more people are willing to spend on Coors Light and Miller Lite within this environment. We'll see whether or not that sticks.

But Brooke, actually what caught me by surprise was he really did not want to directly answer those Bud Light questions. He skirted it a number of times, basically saying that the company is looking past it. I don't think that was a huge surprise. So we'll see whether or not these gains in market share, if they're going to last or not.