#7 - MGP Ingredients (NASDAQ:MGPI)
MGP Ingredients Inc. (NASDAQ: MGPI) is a small-cap stock that analysts love. In addition to its own portfolio of distilled spirits, the company supplies food-grade alcohol to other spirits producers and industries such as personal care, cleaning, and pharmaceuticals.The company also provides specialty wheat starches for various food applications.
MGPI stock took a sharp turn lower in October 2024 after the company announced it was cutting back ingredient production to focus on its own portfolio of brands, citing weakness in the brown goods category, specifically whiskey. Another bearish factor to consider is the short interest on the stock, which is over 27%.
While analysts have been lowering their price targets for the company’s stock, MGP Ingredients still has a consensus price target of $76.67 as of November 18, 2024. That would be a 56.8% gain for investors who can buy the stock for less than $50 per share.
About MGP Ingredients
MGP Ingredients, Inc, together with its subsidiaries, engages in the production and supply of distilled spirits, branded spirits, and food ingredients in the United States and internationally. The company operates through three segments: Distillery Solutions; Branded Spirits; and Ingredient Solutions.
Read More - Current Price
- $45.50
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 3 Buy Ratings, 2 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $76.67 (68.5% Upside)
Despite the fact that some of these stocks have underperformed the market in 2024, alcohol stocks are still considered defensive stocks. This means that they tend to perform well even at times when the economy is not firing on all cylinders. That's particularly true of “sin stocks" that cover areas like alcohol, tobacco, and gambling.
However, alcohol stocks can also offer growth opportunities during economic expansions. As the economy accelerates, disposable income typically increases, leading to higher consumer spending on discretionary items like premium alcohol products. This dynamic makes alcohol stocks appealing in both challenging and favorable economic conditions.
Investors interested in this sector ahead of the expected economic acceleration in 2025 will want to focus on individual alcohol stocks as there is no ETF dedicated exclusively to alcohol companies. For those who prefer broader exposure or wish to invest more conservatively, the Consumer Staples Select Sector SPDR Fund (NYSEARCA: XLP) includes several of the largest alcohol companies within the broader consumer staples sector. This provides a balanced way to invest in both stability and growth potential.
More Investing Slideshows:
