BofA Downgrades Miller Lite Brewer Molson Coors Amid Softness In US Beer Sales

Bank of America downgraded its rating on Molson Coors Beverage's (TAP) shares, citing unfavorable trends for beer sales. However, the retail sentiment remained optimistic.

The investment firm shited its rating to 'neutral' from 'buy' and also trimmed the price target to $50 from $65. The current target indicates an upside of 5.6%.

Shares of Molson Coors, known for its Miller Lite, Coors Light, and non-alcoholic drinks like Beyond Beer, have lost 17.2% year-to-date.

According to the summary of its investor note on The Fly, BofA predicts that U.S. beer volumes will shrink by 4% next year, steeper than its earlier prediction of 1% decline.

"The US beer industry continues to decline below historic trends, market share loss continues, and valuation reflects uncertainty," BofA said in the note.

Consequently, it expects Molson Coors' 2025 and 2026 earnings to be hit. The brokerage lowered its earnings outlook for the Canadian brewer to $5.70 per share for this year from $6.02 and to $6.02 from $6.55 for the following year.

On Stocktwits, the retail sentiment was 'bullish,' dropping from 'extremely bullish' a week ago. The message volume was 'high.'

A user said that they consider TAP as a value buying opportunity, although they are waiting to see the share trend before taking a position.

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In its quarterly report last month, Molson Coors said its net sales decreased by 11% and adjusted profit declined by 47%, primarily due to a weak market for beer.

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