Anheuser-Busch stock has been downgraded by HSBC on Wednesday amid the ongoing backlash after partnering with transgender influencer Dylan Mulvaney.
HSBC analyst Carlos Laboy downgraded stock in Anheuser-Busch parent company, Anheuser-Busch InBev, to “hold.” The downgrade to “hold” signals investors should neither buy nor sell shares of the company. Laboy told CNBC the company is enduring, “deeper problems than ABI admits.”
“Is ABI’s leadership getting the brand culture transformation right? It’s mixed,” Laboy wrote in a Wednesday note, “At Ambev, we think the answer is ‘yes;’ in the U.S., we think it’s ‘no.'”
Ambev is a Brazilian beer brewer which is also under the Anheuser-Busch umbrella.
Laboy questioned the judgement of Anheuser-Busch’s decision to partner with Mulvaney, citing other American companies endured backlash for engaging in divisive cultural issues. Laboy also claimed they potentially alienated their core consumer base. (RELATED: ‘Stop Promoting Transgender Ideology’: Conservatives React To Bud Light’s Return To Twitter)
“Why did its US leadership underestimate the risk of pushback given the recent experience of other firms? Is A-B hiring the best people to grow the brands and gauge risk?” Loboy said. “If Budweiser and Bud Light are iconic American ideas that have long brought consumers together, why did these marketers fail to invite new consumers without alienating the core base of the firm’s largest brand?”
Bud Light sales have dropped as much as 29% in some areas of the U.S.
The brands parent company Anheuser-Busch has had its stock downgraded by HSBC which says the brewing giant is in a ‘crisis’ pic.twitter.com/12TzQVa36m
— Oli London (@OliLondonTV) May 11, 2023
The InBev brewing company came as a result of a 2004 merger between Brazilian brewer Ambev and Belgium company Interbrew. InBev acquired Anheuser-Busch in 2008, forming Anheuser-Busch InBev.
Anheuser-Busch sales have plummeted since the company partnered with Mulvaney. Bud Light sales suffered a 23% drop in the week ending on April 29 compared to a year ago, according to Bump Williams Consulting. Bud Light marketing executive Alissa Heinerscheid, who slammed the brand’s “fratty” image, took a leave of absence from the company on April 22.