Super Bowl LVIII: Key Food and Beverage Stocks to Watch, Including PepsiCo, Chipotle

Observers expect not only football fans but also investors to turn their attention to food and beverage stocks during the Super Bowl weekend. Analysts have spotlighted companies providing the most favored Super Bowl snacks and beverages, indicating potential investment opportunities arising from this event.

In the soda industry, research from Numerator claims soda to be the preferred beverage for Super Bowl parties. Market leaders PepsiCo (PEP), Coca-Cola (KO), and Keurig Dr. Pepper (KDP) are seen as key players likely to benefit. However, Morningstar analyst Dan Su advises favoring Coca-Cola and PepsiCo, given anticipated long-term competitive superiority spanning the next two decades. Similarly, Bank of America's Bryan Spillane identified these soda giants as valuable stocks, attributing this to both their international business scope and sustainable returns likelihood. According to Spillane, investors are focusing on “sales and volume growth," predicting Coca-Cola to outdo PepsiCo by 2024.

Apart from soda, Numerator approximates 37% of football fans expect to purchase beer and 22% spirits before the Super Bowl. Despite an unpredictable performance in 2023, beer manufacturing giants, AB InBev (BUD), Molson Coors (TAP), and Constellation Brands (STZ), are on the offense. Spillane foresees an intense rivalry between these companies during the Super Bowl but suggests that Constellation Brands may have an edge due to the growing popularity of imported Mexican beers.

In the spirits sector, tequila is showing significant growth, according to Robert Ottenstein of Evercore ISI. Diageo (DEO), the company behind Casamigos and Don Julio, leads the sector with a 15.7% volume growth, outperforming the overall spirits sector's surge of 7.2% YoY.

On the snacks front, John Baumgartner of Mizuho Securities expects popular brands to dominate over private labels due to the stature of the occasion. For Baumgartner, Kraft Heinz (KHC), renowned for its snacks, and Mondelēz International (MDLZ), known for cookies and crackers, are potential winners. Peter Galbo of Bank of America also endorses Kraft Heinz, particularly for its Velveeta product.

For chicken wing lovers, Pilgrim's Pride (PPC), the second-largest chicken supplier in the US, offers an attractive opportunity, according to Galbo. He suggests that the company has consistently demonstrated solid operational excellence and fundamentals.

Although the Super Bowl does not significantly boost retail sales, Costco (COST) and Walmart (WMT) still present profitable prospects for value-seeking consumers in 2024, says Jefferies analyst Corey Tarlowe.

For those planning on ordering food for the game, Morningstar's Sean Dunlop recommends YUM! Brands (YUM), whose portfolio includes KFC, Pizza Hut, and Taco Bell. Dunlop also mentions Chipotle as a notable company, based on its successful Super Bowl performance history, primarily due to its efficient takeout and delivery system, which appeals to group events such as Super Bowl parties.