Sam Adams beer maker Boston Beer (SAM) - Get Report received another upgrade on Friday, this time from Citi analyst Wendy Nicholson, who boosted her rating on the stock to buy from neutral amid what she sees as "terrific" growth of its hard seltzer brand, Truly.
In a note to clients, Nicholson said that while hard seltzer sales likely will slow in the cooler months, "we believe that overall, the hard seltzer category will continue to grow at a double-digit rate for as far as we can see."
Nicholson has a $448 12-month price target on the shares.
Shares of Boston Beer rose 3.1%, or $11.85 to $394.25 in Friday trading. The stock has gained more than 60% year to date.
The upgrade follows in the footsteps of other analysts who also see Truly as well as the company's White Claw brand being truly accretive to Boston Beer's bottom line.
"Truly and Claw are now the law," Guggenheim analyst Laurent Grandet wrote in a note to clients last month following his own upgrade. "Truly is far outpacing our estimates with additional room to run next year, even as White Claw remains the category leader."
"SAM is one of the rare staples growth investments that doesn't require a sizable multiple expansion to 'work' as merely a better assessment of its growth potential signals material upside from current levels," BMO Capital Markets analyst Anit Sharma also said in a separate research note last month.