Reply to "What BEER are you drinking?"

Regarding the Constellation purchase of Ballast Point Brewery for $1 billion, yes starts with a b, everyone in the beer business is wondering when it will end. Laginitas just entered a 50% JV with Heineken for $400 million, mainly in order to gain access to markets in Mexico and Europe. Many of the founders of craft breweries are selling out. The valuations are indeed betting on the come with aggressive earnings projections.

The problem is that the established craft brands, ones like Sam Adams and New Belgium, are starting to experience declines in same market sales. For the first time in recent memory, craft sales declined as a part of market share. Sales and profit projections are unrealistic. We may be in a bubble for small brewery valuations.
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