Taking Stock in Wine (Or Donuts)

The wine industry in America is in good shape. Sales are growing. More people are taking to wine. There are issues for the American wine industry, such as falling market share that is being accumulated by imports. But overall, things are moving in the right direction at the moment.

Ever wonder….maybe I should invest in the wine industry. Maybe put a bit of my IRA in wine-related stocks?

Probably the three largest and most visible public wine companies are Constellation Brands,  Diageo and Fortune Brands. Below is a chart marking the growth of their stock prices going back five years.


Roughly speaking, a $10,000 investment in Constellation in May 2001 gives you about $29,000 today. A Fortune Brands invest makes your investment worth about $26,000. The same investment in Diageo brings your investment up to about $15,000.

A similar investment in the Dow, Nasdaq or S&P 500 would have kept you just about even, your $10,000 investment hovering somewhere between $10,500 and $11,000 in value.

What’s this all mean? How do I know? I gave up my stock picking experiments when we cashed out our Krispy Kreme stock with a 100% gain. I figured, if I could make that kind of money on donuts the stock picking game was really all about luck.

However, it is food for thought.

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