Hot Box or Beer Pong?
Despite what some people think, the increasing legalization of marijuana is not a threat to the alcohol industry. A recent study by a top notch Wall Street research firm agreed.
The mass legalization of marijuana doesn’t pose much of a threat to titans in the alcohol industry — at least according to one analyst at a top-tier Wall Street research firm.
Continued legalization of marijuana might actually be to the benefit to beer giants like Anheuser-Busch Inbev (BUD), Molson Coors (TAP) and even Diageo (DEO).
In the past studies have shown that alcohol sales fell in states with legal or decriminalized herb. But that is not true according to the more recent study. The study claims that beer consumption actually saw “a one-time increases of about 0.5 percent in the 10 largest states that have legalized marijuana.”
It is true that there has been a move away from the usual beer brands, Bud, Miller and Coors for example in recent years. But it doesn’t seem that pot is to blame. Independent craft breweries are actually taking the prize for drinker’s choice these days.
The big companies are realizing this and as a result companies like Budweiser have bought up smaller crafter brewers to help diversify their product lines and portfolio.
To conclude, companies like BUD, DEO, TAP and SABMiller (SMBRY) don’t have to worry about competition from pot smokers, but instead need to have their eye on those hipster craft brewers.
Article Inspiration: https://www.columbian.com/news/2014/oct/13/dc-race-debate-legalizing-marijuana/
