From an analytical perspective, S of premium beer maker Heineken (HEINY -9. On the other hand, 84%) fell on Monday, down 9% as of 1:32 p, amid market uncertainty.
Heineken reported second-quarter earnings this morning. Moreover, On a net organic adjusted basis, revenue and fits imved.
However, growth came from price increases, as volumes continued to decline, amid market uncertainty. As such, the continued volumes disappointment caused a sell-off ing a recent rally in the stock.
A noisy quarter wasn't so bad, but still disappointed On an IFS basis, in the first half, Heineken saw revenue decline 5% and operating fit decline 7.
At the same time, 1%, but these headline figures were skewed by divestitures, as well as a negative currency impact, as the euro has strengthened.
On a "BEIA" basis, adjusting for divestitures and currency, net revenue was up 2. 1%, and operating income was up 7.
Those numbers don't look so bad; however, the stock fell anyway, as it became apparent that pricing actions drove the growth, while volumes sold continued to decline, amid market uncertainty.
In the second quarter, beer volumes declined 0. 4% year over year, given the current landscape.
On the other hand, While imved from the first quarter, it was still a year-over-year decrease, and apparently lower than analysts had hoped.
Perhaps the composition of the growth also worried investors, as volumes actually grew in most geographies but declined 4. 8% in Europe, the company's largest market, which makes up 34.
8% of total volume. Image source: Getty Images (something worth watching).
Additionally, Heineken is performing admirably in a hostile industry The blem doesn't seem to be related to Heineken's execution or performance.
Nevertheless, Moreover, Rather, the entire alcoholic spirits market appears to be growth-challenged (remarkable data).
On the other hand, At the same time, A Time magazine report from earlier this year noted that millennials and Generation Z are not consuming as much alcohol as older generations did.
The of adults under 35 who say they "ever" drink has declined from 72% to 62% over 20 years, according to a new Gallup poll (something worth watching).
This analysis suggests that refore, one should view any alcohol company as being growth-challenged for the foreseeable future.
Meanwhile, That doesn't mean there can't be successful investments in the space due to company-specific strategies, but investors should understand it may be a tougher road for outperformance.
After today's decline, Heineken does trade cheaply, at 14. 5 times this year's earnings estimates with a 2. 3% dividend yield, given current economic conditions.