Boston Beer Analysis

3037 words 13 pages
Matthew Schreck
Management 511: Financial Decision Making
Boston Beer Company
April 18, 2013
Amelia Drobile

Boston Beer Company
History and Financial Position
Boston Beer Company (SAM) is a brewery in Massachusetts most commonly known for its Samuel Adams line of “craft” beers. The Samuel Adams line of beer was introduced in 1985. Since then the company has grown to do over 580 million dollars in revenue each year. 580 million is a very small piece of the food and beverage industry but the amount of shareholder wealth they are providing is impressive. Boston Beer Company has been named one of the top publically traded businesses to watch in 2013 by Forbes.
Boston Beer Company is actually part of two
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His actions and goals are seen laid out in all of the company’s press releases and the company is continuing to be grown and maintained the same as it always has been with the exception of Boston Beer Company running its own breweries instead of subcontracting out their orders.
Capital Budgeting Boston Beer Company runs just like any cash business. They have no money tied up in debt and any investment they make is paid for in cash. There is an upside and downside to this method of running a company. On the upside, the company is very liquid, meaning they can pay for most investments on the spot without accruing any debt. However, no debt might deter some investors from buying into the company. Having no debt throws off a company’s ratios in comparison with other companies within the industry and can make it difficult for investors to trust in the company. A typical investment for Boston Beer Company would be opening a new brewery or purchasing an existing one to help the company keep up with the demands for their products. The acquisition of the Diageo brewery 60 miles outside of Philadelphia in 2008 was the company’s most recent investment. Since the purchase, Boston Beer Company has been pouring tens of millions of dollars into the facility that used to employ 220 people to make Smirnoff and now employs 260 people to brew Sam Adams. “Boston Beer's Breinigsville facility


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