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Boston Beer Co Inc (NYSE:SAM), a leading brewer in the malt beverages industry with a market capitalization of $2.59 billion, announced on Thursday that Jean-Michel Valette, a member of its Board of Directors, will retire following the conclusion of the company’s 2025 Annual Meeting of Stockholders. Valette has chosen not to stand for re-election, and his decision is not based on any disagreement with the company’s operations, policies, or practices. InvestingPro analysis shows the company maintains a GOOD financial health score, suggesting strong operational fundamentals.
In addition to this board change, Boston Beer revealed a strategic move to repurchase up to $50 million of its Class A Common Stock. The buyback is set to take place under a 10b5-1 plan, which allows companies to buy back shares at predetermined times to avoid accusations of insider trading. The repurchase period is scheduled to start on March 31, 2025, and will run until June 27, 2025. According to InvestingPro data, management has been consistently buying back shares, with the stock currently trading near its 52-week low of $222.27. Get access to 10+ additional exclusive ProTips and comprehensive analysis with an InvestingPro subscription.
This financial maneuver is often seen as a sign of confidence by a company in its own stock and can be a way to return value to shareholders. It also typically leads to an increase in the earnings per share (EPS) figure, as the number of outstanding shares is reduced.
The announcement comes directly from a recent 8-K filing with the Securities and Exchange Commission by the Massachusetts-based company, known for its craft beers and innovative brewing techniques.
The company’s stock, traded on the New York Stock Exchange under the ticker symbol SAM at $233.45, may see investor reaction to these developments in the coming days. Share buybacks and changes in company leadership are events closely watched by market participants for their potential impact on the company’s future direction and stock performance. With a P/E ratio of 45.64 and a year-to-date decline of 22.18%, InvestingPro’s Fair Value analysis suggests the stock is currently undervalued. Discover detailed valuation metrics and a comprehensive Pro Research Report, available for SAM and 1,400+ other US stocks on InvestingPro.
As of now, there has been no mention of a successor to Valette on the board or any additional changes to the company’s leadership structure. The information provided in this article is based on the company’s official statement in the SEC filing.
In other recent news, Boston Beer Company reported a notable miss in their fourth-quarter 2024 earnings, with an adjusted earnings per share (EPS) of -$1.68, which was below the forecast of -$1.24. Despite this, the company’s revenue exceeded expectations, reaching $402.3 million compared to the anticipated $392.52 million. In response to the financial results, several analyst firms adjusted their price targets for Boston Beer. Bernstein SocGen lowered their target from $315 to $275, maintaining a Market Perform rating, while Piper Sandler reduced their target from $275 to $240, citing sluggish momentum. Evercore ISI also adjusted their target to $275 from $300, and Citi set a new target of $265, down from $290, both maintaining a neutral stance on the stock.
Boston Beer faces challenges in 2025, with increased advertising, promotion, and selling expenses projected to rise by $30 million to $50 million. The company has forecasted an EPS range of $8.00 to $10.50 for 2025, which is below the consensus estimate of $11.51. Analysts from Piper Sandler and Citi have both revised their EPS estimates for 2025 downward, reflecting a cautious outlook. Meanwhile, the company is focusing on new product launches, such as Sun Cruiser, to drive growth, although success with these products is expected to be a longer-term endeavor. Boston Beer has also highlighted the impact of changing consumer habits and competition from cannabis beverages as factors affecting the beer industry.
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