This 236-Year-Old Beer Company Dropped $53M into The Rock’s Energy Drink… Should You Buy They Hype?

Molson Coors (the folks who brought you your uncle’s beer belly) just made a pretty unique move. The 236 year old brewing giant started by an English immigrant out of Montreal is belly flopping into the energy drink market with a $53 million deal to take a majority stake in ZOA, a better-for-you energy drink co-founded by none other than The Rock himself, Dwayne Johnson (because of course he’s involved).

If you’ve been living under a rock (pun intended), the energy drink market is absolutely exploding right now. We’re talking a $19 billion industry in 2023, and it’s expected to grow by at least 8% each year for the rest of the decade. That’s a lot of people swapping their morning caffeine fix for something other than Dunkin or Starbucks. And Molson Coors is all in on the trend.

Fun fact: Molson Coors has actually been lurking around Zoa since 2021, when they first bought a small stake in the brand. But now, they want majority ownership. Why the big move? Because in 2024, sticking to just beer is like still playing tennis when everyone else is on the pickleball court (you're just not keeping up). P

It’s pretty crazy that ZOA has already muscled its way into Amazon's top 10 energy drinks. With a 50% repeat purchase rate, it’s clear the drink has a loyal following. I mean, getting people to come back for a second round in the beverage world is like scoring a second date. And with 30% of Zoa’s customers being first-time energy drink buyers, it’s clear that Zoa’s appeal isn’t just to the caffeine die-hards—it’s winning over a new crowd.

Molson Coors has been making moves to branch out beyond beer for a while now. They recently partnered with an Australian non-alcoholic brand called Naked Life (feel free to insert your own joke here about going “naked”), but this Zoa deal is their biggest swing yet at transforming into a full-on beverage empire. 

Michelle St. Jacques, Molson Coors' Chief Commercial Officer, says the deal "opens the door for us to participate in more parts of the day." Translation: they’re tired of only making money when you're cracking open a cold one at 5 PM. They want to be in your fridge for breakfast, lunch, and beyond—maybe even when you’re getting in your morning workout (thanks to The Rock, of course). The best part? Zoa’s getting a full rebrand, with The Rock front and center in their first national marketing campaign. Because let’s be real, nothing says "healthy energy drink" quite like a guy who could bench press a Toyota Prius before breakfast.

So, should you throw some cash at Molson Coors stock (TAP)? Sure, it’s not exactly Nvidia (only up about 4% this year and another 8% last week). But hey, that’s still better than watching your crypto cry itself to sleep (though maybe it’s starting to rally again - who knows).

But if you want a bullish case, the energy drink market isn’t slowing down anytime soon. With rising demand, it’s projected to be worth over $205 billion by 2032. And Molson is trading at a much lower P/E ratio of around 14 compared to the broader market’s average P/E of about 25. Meaning, there’s still time to get in before their valuation goes bananas like Celsius and Ghost.

PS: Our official "Monday Madness" trade alert spiked 27% yesterday, and from what our system’s showing, this stock’s tiny float could SQUEEZE even hard today (it’s currently up 7% today with way more room to run). If you're tired of hearing about these winning trades after the fact, click here to join Stocks.News Premium and unlock the ticker, plus get 2-3 trade alerts every week.

Stock.News has positions in Molson Coors, Starbucks, Celsius, and Keurig Dr. Pepper mentioned in article.