Anheuser-Busch — Bud Light’s Parent Company — Stock Price Is Looking up After Disastrous Marketing Mishap

Key takeaways

• Bud Light has struggled to make up for lost ground thanks to its disastrous marketing campaign with trans influencer Dylan Mulvaney
• But the Bank of America recently upgraded the stock to Buy
• Parent company Anheuser-Busch is still down over 7% since the start of the year

The parent company of the embattled Bud Light brand, Anheuser-Busch InBev, may just be turning a corner. After a disastrous marketing campaign triggered a boycott from its consumer base, the former most popular beer in the U.S. has struggled to recover ever since.

But a new rating from Bank of America has left investors hopeful of a turnaround for the share price, which has tanked compared to its competitors. Is one analyst upgrade enough to save the brand, or does Bud Light still have major issues with its sales? Here’s the lowdown.

Why has Anheuser-Busch done so badly?

In April, Bud Light started a new marketing campaign with transgender influencer Dylan Mulvaney. The conservative blowback was swift and sharp, with right-wing activists quickly denouncing the brand.

Bud Light soon found its sizeable consumer base turning on it, costing the company a 7% drop in sales in the week ended April 8 and 17% the following week. Anheuser-Busch quickly put the marketing executives responsible for the campaign on a leave of absence.

Six months later, Bud Light is still struggling: the beer only has an 8.9% market share as of September, down from 12% before the boycott. Sales for the drink have fallen a massive 30% compared to last year’s volume, and it’s lost its spot as the top-selling beer in the U.S.

The impact of the marketing failure was clear in AB InBev’s latest earnings report. A big gain in the Chinese market wasn’t enough to stop a global 1.4% loss in sales. The company was still keen to show that the Mulvaney drama had subsided, with its survey showing that 80% of consumers had a favorable or neutral feeling towards the brand.

What’s changed for the stock?

Last week, Bank of America upgraded Anheuser-Busch stock from Neutral to Buy, citing Bud Light’s exposure to the Latin American market as a critical driver for growth. The assessment sent the stock climbing 4% higher last week.

AB InBev stock isn’t out of the woods yet. The drinks conglomerate’s share price has fallen 7.7% since the start of the year, which is dire compared to its competitors Molson Coors and Constellation Brands, which have enjoyed a 23% and 8% rise, respectively.

Even if the stock doesn’t recover just yet, Bud Light can take solace in the fact the Bill and Melinda Gates Foundation Trust invested $95 million into the company last quarter, translating to around 1.7 million shares.

The bottom line

Bud Light and its parent company, Anheuser-Busch, still aren’t done paying their dues after the right-wing backlash the brand suffered. At least the Bank of America stock upgrade has been a bright spot for the company.