Investing in wine stocks may not be as common as other types of growth stocks, but there are still opportunities in the market. While Treasury Wine Estates and The Duckhorn Portfolio are popular choices, conglomerates like LVMH and Constellation Brands also have wine-producing brands in their portfolios.
For those interested in wine investments, physical wine can be a viable option. Buying wine to store and sell later can be a unique strategy for individuals who believe in the appreciation of wine value over time.
One notable English wine growth stock is Chapel Down (LSE:CDGP). Chapel Down is a leading player in the English wine scene, producing more bottles than any other UK vineyard. Despite producing a smaller volume of wine compared to supermarket brands, Chapel Down offers quality wines at competitive prices. The company is well-positioned to benefit from premium buying trends, especially among millennials and Gen Z consumers.
However, investing in Chapel Down does come with risks. As a small-cap stock, Chapel Down can be more volatile than larger companies. Additionally, the stock is not cheap, trading at 70 times earnings for 2023. While detailed forecasts are limited, management has indicated double-digit revenue growth for 2024.
Chapel Down’s unique value proposition includes discounts on wine purchases based on the number of shares held. With plans to expand operations and increase market penetration, Chapel Down is on a growth trajectory. Despite its high valuation, the company holds valuable assets like freehold land, buildings, and a significant wine stock.
In conclusion, Chapel Down presents an interesting opportunity for investors interested in both growth stocks and the wine market. While the stock may seem expensive, its potential for growth and unique offerings make it an attractive option for wine enthusiasts looking to invest in the market.