Value Investors: Retire Rich With This Stock in Your Portfolio

As the beer industry continues to consolidate and diversify to meet consumer demand with broadening preferences, large global brewers such as Molson Coors Canada Inc. (TSX:TPX.B)(NYSE:TAP) are uniquely positioned to thrive.

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Molson Coors Canada (TSX: TPX.B)(NYSE: TAP) manufactures, markets, and sells beer and other malt beverage products in the United States, Canada, Europe, and internationally. The company was formerly known as Molson Coors Brewing Company and formally underwent a name change to Molson Coors Beverage Company in January 2020. The company is over 200 years old, was founded in 1774, and is headquartered in Chicago, Illinois.

Diverse product portfolio

Molson Coors owns a diverse portfolio of beloved and iconic owned and partner brands including Blue Moon, Coors Banquet, Coors Light, Miller Genuine Draft, Miller Lite, and Staropramen. The company continue to invest in and focuses on growing these brands. In addition to these iconic brands, Molson Coors offers premium, premium lights, economy, above premium, and craft beers.

Further, the company offer a modern and growing portfolio that expands beyond the beer aisle. Molson Coors crafts high-quality, innovative beverages with the purpose of uniting people. Additionally, as it continues to evolve a business strategy and portfolio to appeal to the ever-changing preferences of the company’s consumer base, Molson Coors is also broadening the company’s range of products and offerings. This includes Molson Coors’s current and emerging plans in the non-alcoholic beverage segment.

Attractive industry dynamics

The brewing industry has significantly evolved over the years to become an increasingly global beer market. The industry was previously founded on local presence with modest international expansion achieved through export, licence, and partnership arrangements. Over time, the market has become increasingly complex, as the consolidation of brewers has occurred globally. Molson Coors is one of the few players which still exists.

A small number of large global brewers, including Molson Coors, now represent the majority of the worldwide beer market. In addition to the consolidation and the acquisitive nature of the industry, exports, licensing, and partnership arrangements are used and these transactions typically take place between the same global competitors that make up the majority of the market. At the same time, smaller local brewers within certain established markets have experienced accelerated growth as consumers increasingly place value on locally produced, regionally sourced products.

Despite these challenges, Molson Coors is in a dominant position due to the company’s diverse products. In addition to the growth of smaller local craft breweries, changing consumer trends are pushing the industry toward above premium beer, flavoured malt beverages and beyond beer altogether. In recent years, the hard seltzer market has emerged and has experienced phenomenal growth, particularly in the U.S.

Stellar performance and future outlook

Molson Coors evaluates performance in relation to other global brewers using various metrics, including overall market capitalization, volume, net sales revenue, gross margins and net profits, as well as the company’s position within each of the core markets.

As the beer industry continues to consolidate and diversify to meet consumer demand with broadening preferences, large global brewers such as Molson Coors are uniquely positioned to leverage the scale, depth of product portfolio and industry knowledge to continue to lead the market forward. Molson Coors is well positioned to compete in this continually evolving market.

Fool contributor Nikhil Kumar has no position in any of the stocks mentioned.

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