The Business of Beer
While the NCAA bans the sales of all alcohol during its championship games, it will allow broadcast partner CBS and March Madness partner Time Warner (TWC)-owned Turner to air 60 seconds worth of beer ads per hour, as long as they feature products with 6% alcohol by volume or less.
The ban could be a boon for yet another Buffett-owned stock, Coca Cola (KO)—a 1988 investment in the beverage company has earned Berkshire Hathaway $9.2 billion or a 766% gain since that time.
You might consider investing in Coca-Cola too, especially if you’re a basketball fan. The company recently announced that it would collaborate with LeBron James on a limited-edition Sprite 6 Mix that has a splash of cherry and orange flavor. But KO can give investors more than refreshing drinks. It also delivers a 19% higher return on equity than any other stock in its industry, and a 3.2% dividend which has risen for the past 50 years straight.
Although fans won’t be drinking beer at the games, odds are (and much better than winning Buffett’s billion) that they will at home, in restaurants, and in sports bars.
Molson Coors Brewing (TAP) may quench your thirst for profits. TAP has delivered positive earnings surprises in each of the last five quarters, with the last one coming in 14% above estimates. Formed in 2005 by the merger of Molson Canada and Coors in the U.S., the company has grown earnings at a rate of 4% over the past three year sales at 11%.
The company also has an annualized dividend growth rate of 10%, and as part of its fourth-quarter 2013 earnings release, raised its quarterly dividend 16% to 37 cents a share, giving it a 2.6% annual yield.
With Molson think: Coors Light, Molson Canadian, Carling, Staropramen and Blue Moon across the Americas, Europe and Asia; and popular Mexican brands like Corona, Negra Modelo and Pacifico brands.