UBS Rates Boston Beer at ‘Neutral’

UBS, the global financial services company headquartered in Switzerland, released an investment report today on the country’s top craft brewer, Boston Beer Co.

The inaugural rating for the makers of Samuel Adams? Neutral. UBS sees “limited upside” in SAM shares.

UBS reports that despite being the largest craft brewer in the U.S. — they produced 2.48 million barrels last year — their “share of the segment is eroding.” The report points to Twisted Tea and Seasonals as the reason for the company’s 5 percent growth in 2011.

UBS notes that volume growth for Boston Beer slowed from 12 percent in 2010 to 9 percent in 2011, despite overall craft beer category growth of 14 percent. For 2012, UBS predicts volume growth of just 7.5 percent and depletion growth of 9 percent.

As for the overall craft beer category, UBS is bullish. They predict that the craft beer segment will reach 10 percent market share by 2016 — most of the growth coming from new entrants to the category and smaller brewers, not BBC.

You can read the full 32-page report here.