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Repealing “blue laws” and permitting the sale of alcohol on Sundays has a much smaller negative effect than what was anticipated by critics.

A new research paper put forth by Cristina Connolly and Alyssa McDonnell from the University of Connecticut, Marcello Graziano from the Norwegian University of Science and Technology, and Sandro Steinbach from North Dakota State University, showcases this. The research published in the Journal of Wine Economics by Cambridge University Press, investigates “the effect of implementing changes to Sunday blue laws on alcohol sales and retail competition, particularly in relation to Connecticut’s 2012 policy shift that allowed the sales of beer in grocery stores on Sundays.”

The prohibition on Sunday alcohol sales in Connecticut, a law that was more than a century old, was revoked in 2012. This occurred thirty years after the Connecticut Supreme Court ruled the majority of the state’s other Sunday sales prohibitions unconstitutional. The changes also permitted liquor stores to operate on Sundays, and grocery stores were allowed to sell beer on the same day.

Despite the changes to the blue laws, there are some who object to them. As per the Tech Talk newspaper from Massachusetts Institute of Technology, a study in 2008 suggested that “the revocation of America’s blue laws resulted not only in a decrease in church attendance, donations, and spending, but also led to an increase in alcohol and drug consumption among people who were religious.”

Connecticut’s repeal was opposed at the time by liquor store owners themselves, who expressed concern about everything from the “social costs” of more alcohol sales to the extra expense incurred from being open an extra day.

“Proprietors of liquor stores in Connecticut and store association lobbyists claimed that allowing Sunday sales would negatively impact their livelihoods,” write the authors of the new study. “Not only would they need to pay operating costs for an extra day of the week, but there was also a concern that consumers would shift to purchasing beer at grocery stores as Sunday is one of the most popular grocery shopping days. Specifically, Connecticut’s liquor store association claimed that, as a direct result of this policy, liquor stores would lose sales and reduce employment, or close.”

The authors examined Connecticut’s sales figures for grocery and liquor stores both before and after the repeal, using other states without Sunday alcohol laws as a control group. They found “no evidence of negative impacts on beer sales in liquor stores.”

“Despite repeated claims by liquor store associations,” the report concludes, “repealing these laws did not harm liquor stores, suggesting that it is possible to repeal Sunday blue laws without negatively impacting smaller businesses.” Incidentally, the study also contradicted claims by grocery store lobbyists, who said Sunday alcohol sales would “have large, positive economic impacts.”

The same data also provides comfort for those who worry that being able to buy alcohol one additional day per week would lead to an explosion in alcoholism and addiction. “Our estimates indicate that repealing these laws significantly increased beer sales at grocery and liquor stores directly after the policy shift, but these effects disappeared afterward.”

“There is an initial bump in sales, possibly due to the novelty of the policy,” they found. “This impact levels off after the initial month, with no discernible effect on sales after the seventh week.”

As it turns out, the repeal benefited both consumers and vendors while proving the doomsayers wrong. But it was also a net positive for economic liberty as another piece of Prohibition falls by the wayside.

The post Study: If You Let People Buy Beer at Grocery Stores, the Liquor Stores Still Survive appeared first on Reason.com.

POTOSI, Wisconsin − It seemed as if a bomb had detonated in the brewery.

Following its closure, the structure was pillaged, with individuals taking whatever they could transport, possibly as keepsakes or goods to sell. This was indicative of the harsh loss of 1972 when Potosi descended into an extensive economic ice age. Gradually, the brick walls of the building came tumbling down and debris was scattered all over.

This loss wasn’t merely about a single enterprise in a quaint town nestled within the towering bluffs of Wisconsin’s Driftless region near the Mississippi River. It appeared to be the final nail in the coffin. Local farms had been vanishing for years, and now, major industrial employers were following suit. Residences were abandoned, specifically by the youth who were the community volunteers and taxpayers. Schools saw a decrease in child enrollment and a critical shortage of new ideas to help reverse the decline. This vision of the future was fading with every passing moment. “What would be the outcome?” former Village President Frank Fiorenza remembered pondering. “We staunchly refused to let this community die.”

Once a thriving mining and farming town with a population of 5,000 in the 1800s, the numbers dwindled over the years to a mere few hundred. Mic Walsh remembered losing the brewery, and a series of machinery vendors at the same time as the local agriculturist community was floundering. The proprietor of a local Ace Hardware store witnessed his client base dwindling, and the distress permeated the community. The local pharmacy was shut down. The town’s two barber shops followed suit, and many more establishments faced a similar fate.

“It all just multiplies,” Walsh said. “It’s hard to see.”

Across America, there are scores of places just like Potosi that have collapsed as the economy shifted from rural to urban. After the most recent U.S. Census in 2020, America’s population was only 14 percent rural, the lowest on record and a steep drop from 57 percent in 1940, according to research by University of New Hampshire rural demographer Kenneth Johnson.

Wisconsin deer hunting is dying. That should worry you even if you don’t hunt.

While that shift might seem unstoppable, there are times when the flow reversed. One was during a global economic crisis when jobless people retreated from cities to the shelter of family farms during the Great Depression. Another was a global pandemic, where they fled from crowded offices amid COVID-19 to remote work in sparsely populated places far from the city. In just the past two years, two-thirds of Wisconsin counties gained population, far away from fast growing places like Dane County.

In the wake of COVID-19, as many organizations usher staff back to offices and city centers aim to rejuvenate eerily vacant downtown areas, rural America stands at a pivotal junction. This situation is deeply personal to me, as I, a farm boy who moved away, continue to grapple with finding a way to contribute to the solution. I discovered some potential strategies in Potosi, a region demonstrating how a strong sense of identity, a culture of volunteering, and enterprising spirit could potentially offer a blueprint for reviving rural parts of the country.

The scope and magnitude of the issue—decreasing rural populations and the accompanying loss of economic activity, prospects, and accompanying sense of despair—is overwhelming.

Johnson, the demographer, highlighted that for years the main driver of rural decline was that rural regions were not growing as rapidly as urban ones. However, this trend shifted between 2010 and 2020, during which rural populations actually decreased. The problem worsens when a community not only experiences more departures than arrivals but also higher death rates than birth rates.

This is an important issue regardless of where you reside. Rural communities, that provide our food, natural resources, affordable labor, among other things, are crucial to our national economy. Their diminishing state contributes to further concerns, such as our rural-urban divide and the ongoing national drug crisis.

Rural states like Wisconsin are often home to isolated communities that struggle to survive. But is it possible for these communities to completely disappear?

According to historians, the answer is yes. One example is Gratiot’s Grove, a former mining town that has since vanished but is remembered in the book “Ghost Towns of Wisconsin” by William Stark.

“Some towns just vanished into thin air, while others kept fighting for survival,” says Jerry Apps, a well-known author and historian from Wisconsin. He has a new book, “On Farms and Rural Communities,” scheduled to be published this spring.

The vast impact of the economic disruptions plaguing Wisconsin is apparent from a few statistics, which show how sectors from farming to paper mills to manufacturing are having a tough time:

135,000: This is the number of farms Wisconsin has lost since its peak in 1935, which represents a decrease of more than 67 percent, as stated by the U.S. Department of Agriculture data.

8,200: This figure represents jobs lost in the wood and paper industries, which notably includes Wisconsin’s renowned paper mills, in just one decade from 2006 to 2016. According to state data, small towns like Wisconsin Rapids are facing difficulties following the closure of their mills, such as Verso’s closure in 2020.

3,200: This is the number of jobs at the Janesville GM plant and its associated suppliers that were lost following the plant’s closure in December 2008. According to Janesville Gazette’s reports at that time.

Despite such hardships in the industries, there are signs of hope. Wisconsin continues to lead consistently in cheese and cranberry production. Many jobs and communities are tied to the agricultural sector. Partial recovery and reorientation have stirred up demand for paper industry workers in the recent years. Regardless of the impact of the GM plant closure on the city and rural areas, Janesville is striving to diversify its economy.

Many rural communities are also turning toward tourism and working to find a unique identity to continue luring people back to places once dismissed as dying ghost towns. The ongoing resilience of rural areas and small communities, through decades of change, mean rural Wisconsin isn’t even close to done, Apps said.

“The revolution in rural America is not complete,” he said.

I don’t remember the first time I thought about leaving home, but I remember the first time I said it out loud.

It was 2008 on Broadway Avenue, Nashville’s famous thoroughfare known for country music streaming from bars up one end and down the other. We were on a rare family vacation visiting Tennessee’s Music City. I was standing under the neon lights, a few too many drinks singing in my head as the honky tonk music poured onto the sidewalk, when my dad walked out and saw me.

“I’m gonna live here someday,” I said.

There was an immediate distance in that moment, even though we were standing right next each other.

Growing up on our family farm, I always felt like I was falling short — deeply loving our way of life but lacking the innate talent for managing cattle and maneuvering tractors like my father. My dad had spent his entire life on the farm and knew nothing else. He supported my decisions, yet I could always sense a part of him wishing I had chosen his path. Stumbling upon writing, I realized it brought out my strengths. This discovery led me to college and to various newsrooms around Wisconsin, where I finally felt valued and competent.

To me, Nashville didn’t just mean a better economy or job opportunities. It represented a place where a simple farm boy could feel proud. It was a big city, sure, but it was also the home of country music, a place where my roots and profession could merge. But for my dad, Nashville was merely a distant, noisy place, over 600 miles away from everything he knew and loved. The sadness in his eyes was palpable — as if a crack had formed in a whisky glass.

Experiencing a personal, challenging moment illustrated the struggles faced by rural communities across Wisconsin. A variety of economic opportunities could have made it possible for me and many other rural children to resist the allure of opportunities elsewhere, particularly when there seems to be a decline at home.

Potosi, on the other hand, didn’t succumb to ghost town status. It was the collective effort of many individuals that reversed the trend. Fiorenza, for example, rejected the role of being a “caretaker” as village president in the 90s; local businessman Gary David bought the decaying brewery building because he and others recognized its historical value; and countless volunteers like Walsh, Larry Kalina and his wife, among others.

In the end, the community raised millions, including $2.4 million from individual contributors, and re-established the Potosi Brewing Co. which is today run by the nonprofit Potosi Foundation. An empty building in a dwindling town was transformed into a unique location for both locals and tourists. The old brewery was converted into a tap house and restaurant in 2008, designed as an old beer hall – a beautifully crafted wooden bar spanning the main wall, with a long row of wooden Potosi-brand beer taps set up behind it. Beer is still brewed there and there’s a museum upstairs, with much more being produced in the newly constructed larger facility nearby.

Along with the job creation and the attraction of approximately 70,000 tourists annually, came an increase in economic activity bolstering other businesses. Today, a woodworking shop stands across the street from the brewery, with a special event space and a cabin builder situated close by.

Through all the adventures and explorations, what drew me back was something different, something unique.

Five years were spent in Nashville, then Washington, D.C., where my journey as a journalist pivoted to public policy. Then, I decided to return. The event that nudged me to make this decision was the birth of my second nephew, but of course, there were other compelling reasons that had always been there; including the beckoning of family ties, the allure of outdoor adventures, and the comfort of familiar local destinations that had endured the passage of time. Above all, it was about reconnecting with my roots.

Having moved back, I found myself involved in the establishment of a consulting firm in Madison, spending my weekends on the farm. Time was invested in bonding with my sister and her lovely kids, reminiscing with my parents, and reconnecting with friends from my childhood. I found myself assisting my father and sister on farm tasks whenever I could manage, and rediscovered my skills in operating a tractor. Together, my dad and I made a spot of land ready for a cabin, right beside our family farm. I began to find a sense of restless peace, accepting my role as someone who had left but didn’t need to remain away.

The pandemic greatly amplified this dynamic. Regardless of its harsh effects and the ensuing economic downfall, there is one aspect it certainly highlighted – the potential of working from different locations. More people working in cities are now capable of living in the countryside or small towns. Simultaneously, it’s evident that more people in rural settings can become part of the remote workforce, adding to the traditional farming, factory, and construction jobs.

More from Brian Reisinger:

Fighting a fire. The blaze that could have sunk our family farm.

My best friend is on the frontline: Wisconsin’s rural drug addiction crisis in my hometown

That positions places like Potosi better than ever. With the brewery humming, the town becoming a destination spot, and new small businesses coming in, Potosi is as ready as any community to benefit from the new mobility of the American population.

Despite retiring, many of those who contributed to Potosi’s rebirth continue to give their time and energy, serving as role models for younger generations. Walsh, a previous hardware store proprietor, volunteers his services as a brewery gardener and handyman, while Fiorenza, a former village president, along with the Kalina family, lends a hand to upcoming community initiatives like the revival of downtown.

Larry Kalina, a member of the committee managing Potosi’s continued renewal efforts, along with his wife, has four children who are all teachers. He is proud of his children and is thankful that they are all approximately two hours away. However, he has also encountered his children seeking job opportunities far away, highlighting the need for Potosi to offer inhabitants new livelihood options and visitors with tangible reasons to visit.

He was quoted saying, “The trick is to stir people’s enthusiasm.”

My personal situation underwent a shift as my wife and I relocated to California due to a job opportunity that put us in close proximity to her family. Nevertheless, we retained the benefits I had reclaimed. As my employment permits me to work from any location, but necessitates regular returns, I divide my time between our small town in Northern California and rural Wisconsin, where I reside on the family farm, a place I hadn’t lived in since I was 18. I contribute to the farming business, preferring to spend my money and time in small towns, or with local businesses rather than large chains whenever feasible.

As I traverse the divide between the relentless pull of the urban economy and the rural economy I’ve reestablished connection with, I can’t help but muse over the potential of areas like Potosi as a guide. Times of upheaval are often when people hark back to rural regions; this is a testament to their intrinsic need. Despite having two distinctive economies in this nation, it isn’t a necessity for regions such as Potosi to settle for the leftovers. Perhaps more individuals can retain their roots or better manage the balance between our dual economies to unite them.

Fiorenza posed the question, perched in the beer hall of times old and new, “How do you persist?” The response was simple. “You adapt.”

Brian Reisinger is a writer originating from a family farm in Sauk County, with an extensive portfolio across various media outlets, uncovering the concealed tales of rural America. From the drug crisis to the histories and prospects of Wisconsin farmers, to outdoor escapades, Reisinger provides insights and understanding. Reisinger is currently engaged in public affairs consultation with Platform Communications based in Wisconsin. An alumnus of University of Wisconsin-Eau Claire where he studied journalism and political science, he has been the recipient of accolades from the National Society of Newspaper Columnists, Seven Hills Review literary magazine, Wisconsin Newspaper Association, among others.

Originally featured on Milwaukee Journal Sentinel, you can read the complete article here.

In this article I utilize A+ Investor Stock Grades offered by AAII to offer an insight into three beer stocks. Coming to the point, should you mull over the beer stocks of Anheuser-Busch Inbev S.A. (BUD), Heineken N.V. (HEINY) and Molson Coors Beverage TAP?

Although the brewing industry has been experiencing an upsurge in diverse niche players such as microbreweries and craft breweries, it’s still the domain for a select few influential corporations. These dominant corporations often have multinational presence and play a key role in determining market trends and catering to consumer needs due to their vast resources and wide market reach. These industry giants have been embracing the trend of product portfolio diversification in order to cater to the growing consumer interest in nonalcoholic and low-calorie beer options. It’s evident from the competitive landscape of the industry that whether it’s big or small, companies need to constantly adapt to changing consumer habits and regulatory requirements to sustain or increase their market shares.

The brewing industry is a vibrant and evolving subgroup within the global beverage market. According to Straits Research, beer is the most consumed alcoholic beverage worldwide, ranking after water and tea. The industry is multi-faceted, catering to diverse consumer preferences and production scales. It includes macrobreweries that operate on a global level, microbreweries that emphasize on crafting small batches of beers, and craft breweries that strike a balance between mass production and artisanal qualities.

As per Straits Research, the estimated size of the global beer market was $721.1 billion in 2022, and it is expected to grow at a compound annual growth rate (CAGR) of 6.9% to reach a whopping $1.32 trillion by 2031. Factors driving the market growth are the rising number of breweries coupled with a consistent increase in demand for alcoholic beverages due to rising standards of living and evolving lifestyles.

When analyzing a company, it is helpful to have an objective framework that allows you to compare companies in the same way. This is why AAII created the A+ Stock Grades, which evaluate companies across five factors that have been shown to identify market-beating stocks in the long run: value, growth, momentum, earnings estimate revisions (and surprises) and quality.

Using AAII’s A+ Stock Grades, the following table summarizes the attractiveness of three beer stocks—Anheuser-Busch, Heineken and Molson Coors—based on their fundamentals.

AAII’s A+ Stock Grade Summary for Three Beer Stocks

Anheuser-Busch Inbev S.A. (BUD) is a producer, distributor and marketer of beer, alcoholic beverages and soft drinks. Its brand portfolio includes global brands such as Budweiser, Corona and Stella Artois; international brands, including Beck’s, Leffe and Hoegaarden; and local champions such as Bud Light, Skol, Brahma, Antarctica, Quilmes, Victoria, Modelo Especial, Michelob Ultra, Harbin, Sedrin, Klinskoye, Sibirskaya Korona, Chernigivske, Cass and Jupiler. The company’s soft drinks business consists of both its own production and bottling and distribution agreements with PepsiCo PEP. Ambev, which is a subsidiary of the company, is a PepsiCo bottler. Brands that are distributed under these agreements are Pepsi, 7Up and Gatorade.

The company ranks D in Value Grade due to its high Value Score of 37. Its Value Grade is derived from various factors like price-to-sales ratio, price-earnings ratio, price-to-book-value ratio, price-to-free-cash-flow ratio, shareholder yield and the ratio of enterprise value to earnings before interest, taxes, depreciation and amortization aka Ebitda. With a price-earnings ratio of 20.8, a price-to-book ratio of 1.73 and a price-to-free-cash-flow ratio of 22.7, it sits in the 57th, 52nd and 59th percentiles accordingly.

Growth Composite Score takes into account a firm’s year-over-year and long-term sales growth, and its effective generation of stable cash from core operations. At present, Anheuser-Busch has a Growth Grade of C with a Growth Score of 57. Over the past five years, it achieved a sales growth rate of 0.5% and recorded year-over-year sales increase twice. Consistent positive cash generation from operations is another positive attribute over the last five years.

Anheuser-Busch has a Momentum Grade of B, attributed to its Momentum Score of 65. This indicates that the stock has shown impressive weighted relative price strength over the previous four quarters. Factors contributing to this score include above-sector-median relative price strengths of 3.6% in the recent quarter, –2.5% in the penultimate quarter and 7.5% in the fourth most recent quarter. This is slightly dampened by the below-sector-median relative price strength of –19.3% in the third most recent quarter. The subsequent ranks end up as 66, 62, 25 and 84, in order from latest quarter. The overall weighted four-quarter relative price strength is –1.4%, yielding a final rank of 65. The calculation applies a 40% weighting to the most recent quarterly price change, and 20% each to prices from preceding three quarters.

Earnings estimate revisions provide an insight into a firm’s short-term prospect as perceived by analysts. For Anheuser-Busch, this figure stands at an unimpressive Grade of F, based on its score of 20. Factors leading to this score include the statistical significance of the firm’s latest two quarterly earnings surprises and the percentage variation in its consensus estimate for the present fiscal year over the past one and three months.

Anheuser-Busch reported a positive earnings surprise of 3.6% for the third quarter of 2023, and in the prior quarter reported a positive earnings surprise of 6.5%. Over the last month, the consensus earnings estimate for full-year 2023 declined to $3.03 per share based on two upward and three downward revisions. The 1.8% decline in its earnings estimate ranks in the bottom 11th percentile of all stocks.

Heineken N.V. (HEINY) is a Netherlands-based company engaged in the brewing and selling of beer. Heineken’s product range mainly consists of beer, soft drinks and cider. The company operates through five segments: Africa, Middle East and Eastern Europe; Americas; Asia-Pacific, Europe and head office and other/eliminations. The Africa, Middle East and Eastern Europe segment includes brands such as Heineken, Primus, Amstel, Walia and Goldberg. The Americas segment includes brands such as Heineken, Tecate, Amstel, Sol and Dos Equis. The Asia-Pacific segment includes brands such as Heineken, Anchor, Larue, Tiger and Bintang. The Europe segment includes brands such as Heineken, Cruzcampo, Birra Moretti, Zywiec and Strongbow Apple Ciders. The company owns, markets and sells in more than 190 countries.

The company has a Value Grade of D, based on its Value Score of 25, which is expensive. The company has above-sector-median measures for its price-to-book and price-to-free-cash-flow ratios, which are 2.68 and 32.7, respectively. Additionally, the company has a below-sector-median price-earnings ratio at 20.3.

The company currently has a Growth Grade of A, based on a Growth Score of 89. The company has a five-year sales growth rate of 5.9% and has seen sales increase year over year in four out of the last five years. Cash from operations has also been positive for five consecutive years.

The company showcases a Momentum Grade of C, traced back to its Momentum Score of 55. This score is calculated from relative price strengths exceeding the sector-median at -2.9% in the latest quarter and 11.9% in the fourth previous quarter. However, it is somewhat balanced by a lesser than sector-median relative price strength of -11.2% in the second previous quarter and -14.3% in the third previous quarter. The ranks come out as 54, 46, 33 and 88, from the latest quarter sequentially. The aggregated four-quarter relative price strength stands at -3.9%.

Heineken presently holds no Quality Grade due to null values for five out of the eight variables that underly the Quality Score. To receive a Quality Score, stocks need to showcase a valid (non-null) measure and corresponding rank for a minimum of four out of the eight quality measures.

Molson Coors Beverage Co. (TAP) is classified as a holding company. Its operations are divided into two segments: Americas and EMEA and APAC. The Americas segment primarily involves the production, marketing, and sales of its brands and other owned/licensed brands in the U.S., Canada, and various Caribbean, Latin, and South American countries. It oversees around nine main breweries, nine craft breweries, and two container functions. Additionally, it features a partnership associated with beer distribution in Ontario, Canada, and Brewers’ Retail Inc. The EMEA and APAC segment involves the production, marketing, and sales of primary and other owned/licensed brands throughout various European countries and chosen countries in the Middle East, Africa, and Asia-Pacific. This segment operates 11 main breweries, six craft breweries, and one cidery.

Molson Coors showcases a Value Grade of C, which is tagged to its Value Score of 58, an average rating. The company’s price-to-sales, price-earnings, and price-to-book ratios, which are 1.17, 54.0, and 1.02 respectively, rank below average. On the other hand, one above-average ranking contributes to its Value Grade: a shareholder yield of 2.9%.

The current Growth Grade for the company is C, with a Growth Score of 48. Over the past five years, the company has seen a sales growth rate of -0.6% and has witnessed an increase in sales for two out of the past five years. Positive Cash from operations has been consistent for five successive years.

An Earnings Estimate Revisions Grade of C is held by Molson Coors. This is based on a neutral score of 59. In the third quarter of 2023, the company reported an earnings surprise of 21.9% and in the previous quarter, a positive earnings surprise of 8.9% was reported. The consensus earnings estimate for Q4 2023 over the last month has been steady at $1.116 per share, with three upward adjustments and two downward revisions.

Molson Coors has a Quality Score of 76, awarding it a Quality Grade of B. This is quite strong. The Quality Grade A+ is given as the percentile rank of the average percentile ranks of return on assets (ROA), return on invested capital (ROIC), ratio of gross profit to assets, buyback yield, the change in total liabilities to assets, ratio of accruals to assets, and the F-Score. If any of the measures are invalid, the score is variable and considers the valid remaining measures.

The company has a weak ranking in terms of return on invested capital and the ratio of gross income to assets, but its F-Score is strong. Molson Coors has a 13.4% return on invested capital, 16.0% ratio of gross income to assets, and an F-Score of 8 (with 9 being the highest possible score). The sector median return on invested capital is 18.8%, median gross income to assets is 23.3%, and median F-Score is 4. Other metrics for Molson Coors that rank below the sector median include return on assets, change in total liabilities to assets, and Z-Score. Apart from the F-Score, the only metric where the company ranks higher than the sector median is its buyback yield, which stands at 0.3% in comparison to the sector’s median of -0.2%.

The stocks meeting the criteria of the approach do not represent a “recommended” or “buy” list. It is important to perform due diligence.

If you want an edge throughout this market volatility,become an AAII member.