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Despite Bud Light Backlash, BUD Stock Is Still a Solid Pick for 2023


  • Anheuser-Busch Inbev (BUD) experienced backlash due to the company’s association with a social media influencer.
  • The controversy will probably pass at some point, and Anheuser-Busch still offers value and dividends to investors.
  • Investors might consider a share position in BUD stock now.
BUD stock - Despite Bud Light Backlash, BUD Stock Is Still a Solid Pick for 2023

Source: legacy1995 / Shutterstock.com

There’s no way to avoid the topic, as it’s in the headlines now. If you conduct a search on Anheuser-Busch Inbev (NYSE:BUD), you’ll inevitably catch wind of a heated debate that involves a particular social media influencer. Does this mean you should abandon BUD stock? The final decision is yours to make, but there are reasons to consider looking past the controversy and investing in Anheuser-Busch.

Anheuser-Busch is, of course, a seller of beer and other alcoholic beverages. What many people don’t know is that Anheuser-Busch is committed to innovation in manufacturing alcoholic products. In fact, the company has already allocated millions of dollars toward state-of-the-art brewing technology and infrastructure.

Anheuser-Busch seeks to maintain its leadership position in the U.S. brewing business. It’s a company that respects its shareholders and offers a solid dividend yield.

Plus, BUD stock has strong momentum but still offers a good value. Before we can get into those details, we can’t avoid addressing the 800-pound elephant in the room.

BUD Anheuser-Busch Inbev $63.62

Anheuser-Busch and the Dylan Mulvaney Backlash

This topic is top-of-mind in the media, and it could affect the Anheuser-Busch Inbev share price, so we can’t avoid it. Specifically, people are talking about Anheuser-Busch’s partnership with Dylan Mulvaney.

Reportedly, Mulvaney has over 10.8 million followers collectively on various social media platforms. Mulvaney is controversial because of her gender identification. Apparently, BUD stock dipped 1.8% after Mulvaney posted a video on April 1.

That dip is really just a slight bump in the road compared to the impressive year-to-date rally in the Anheuser-Busch share price. Indeed, folks to take a “this, too, shall pass” stance could benefit in the long run.

Citigroup analyst Simon Hales certainly doesn’t envision Anheuser-Busch collapsing because of the Mulvaney situation.

Hales assures that “recent backlash in some parts of the U.S. to Bud Light’s new advertising campaign with Dylan Mulvaney is overdone,” and “recent share price weakness provides an attractive buying opportunity.”

BUD Stock Is a Value-and-Yield Combo

If you’re not prepared to look past the controversy, you can certainly choose not to invest in Anheuser-Busch. However, you could end up missing out on a source of quarterly income and a decent value.

Some people might consider BUD stock a defensive investment because, even during recessions, people still drink beer (and sometimes they might even drink more of it). Also keep in mind that dividend payers can be good investments during times of economic uncertainty.

Anheuser-Busch Inbev falls into this category as the company pays a forward annual dividend yield of 1.25%, according to Yahoo! Finance. That’s not the only reason to invest in Anheuser-Busch, but it’s a nice bonus.

Even while BUD stock had strong upward momentum over the past six months, the stock is still a good value. Anheuser-Busch’s trailing 12-month price-to-earnings (P/E) ratio of 22.38x is slightly more favorable than the sector median P/E ratio of 22.84x. Furthermore, the company’s trailing price-to-book (P/B) ratio of 1.76x is favorable compared to the sector median P/B ratio of 2.62x.

What Can You Do Now With BUD Stock?

Value seekers and income investors should take a closer look at Anheuser-Busch Inbev. However, they’ll also need to decide whether they can look past Anheuser-Busch’s association with Mulvaney.

It’s a personal decision and a financial one. Still, there’s merit to the idea that what’s controversial today will probably be old news in a few weeks or months. So, feel free to consider your stance on Anheuser-Busch and then think about taking a buy-and-hold position in BUD stock.

On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.

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Article printed from InvestorPlace Media, https://investorplace.com/market360/2023/05/bud-stock-is-a-solid-defensive-pick-for-2023/.

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