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The week's question
In March 2025, in the thread "Re: OT, out", Umm asked the members: "Do you think it is because America is made up of magical soil that makes businesses based in America magically profitable?" This week it is put to everyone again. The button below opens the small thread re-asking it - read what others have said so far, then give your own answer as an ordinary reply.
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Stocks A to Z / Stocks B / Berkshire Hathaway (BRK.A)
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Author: mungofitch ✹✺🐝 SILVER
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Number: of 22347 
Subject: Re: What recent Berkshire security do you like best_QM
Date: 09/10/25 12:47 PM
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What’s typical behavior for liquor stocks during recessions? Do they tend to keep their value due to increased sales to people down on their luck, or do they react like cosmetic makeup sales, increasing as a treat to oneself during hard times?

Historically they were considered very defensive. Earnings chugged along. Obviously everything sells off briefly during a stock market panic, but they generally held up better than most things. Brown-Forman was trading around $15 (say, 13.50 - 16.50) in the two years before the credit crunch, and was back there by around end '09 after a brief dip into the $10-11.25 range.

The pandemic was an exception for most alcohol groups. People stayed at home and drank a lot, among other things, so they had a little bubble then a hangover from the bubble. The Peloton effect. So you have to ignore earnings and price levels during the pandemic recovery.

I mentioned the big four international drinks firms a while back on the non-US stocks board, though it could just have easily been Falling Knives. (Diageo, Campari, Pernod-Ricard, and Remy Martin)
mungofitch writes on Booze
They're all currently still 37% - 57% off their 52 week highs. (well, 52 weeks ending at the date of that post)

Jim

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This community has written 21,850 posts about Berkshire Hathaway. The article-length ones it recommended most:
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