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Enjoy Alcohol Stocks -- In Moderation
By Greg Levine | 01 Apr 2008 | 10:21 AM ET
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Picks and Pans

Ann Gilpin, beverage analyst at Morningstar, isn't afraid of soaring commodity prices or tepid consumer spending.

"As we go into any kind of consumer slowdown, [alcohol] stocks should hold up relatively well," she maintains.

Gilpin explained her confidence to CNBC -- and offered her top stock picks.

Outlook

Throughout economic see-sawing of the last 50 years, "Alcohol consumption per capita in the U.S. has remained relatively flat," Gilpin said.

"Alcohol stocks are classically counter-cyclical."

Recommendations

The analyst suggests sticking with companies that have broad product reach and very deep pockets. Her No. 1 pick: Diageo [DEO  Loading...      ()   ], a "behemoth" that "dominates distribution in the U.S." and has "left rivals in the dust in developing markets."

She also likes Anheuser-Busch [BUD  Loading...      ()   ], Brown-Forman [BFB  Loading...      ()   ] and eponymous Molson-Coors Brewing [TAP  Loading...      ()   ].

(Sorry, Sam Adams quaffers: Boston Beer Company [SAM  Loading...      ()   ] is "relatively overpriced" at current levels, Gilpin said.)

Disclosure

Neither Gilpin nor her employer currently hold shares in any of the companies mentioned.

Disclaimer

© 2008 CNBC.com

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