Boston Beer (SAM) reported another strong quarter of revenue growth thanks to its Truly hard seltzer and Twisted Tea brands. Absent the positive impact of the Dogfish Head beer acquisition, which closed in the quarter, overall depletions - sales by alcohol distributors to retailers - were up 24% in Q3. This is impressive growth both sequentially and yoy. Depletions were up 17% in Q2 and were up 18% Q3-18.

However, shares have tanked to ~$350 after peaking at $444. I argued in August at $437 that shares were overpriced. Shares are more reasonable at $350, but still come with risk.

The success of SAM has been confined to the company's Truly and Twisted Tea brands. SAM's Samuel Adams beer and Angry Orchard hard cider businesses continue to struggle. Truly is one of two brands - the other White Claw - dominating the new hard seltzer category. The company says Truly and White Claw comprise 80% of industry sales and the hard seltzer market is expected to double in size next year. If Boston Beer simply maintains its market position, its Truly sales will double in 2020.

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