SAM Aug 2011 Valuation

8/6/2019 SAM Aug 2011 Valuation

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Boston Beer Co Inc The(sam)

Figures in Millions except per share values

Company Overview

ValuationCurrent Price 85.40$ Margin of SafetyNCAV 2.95$

Total Net Reprod. Cost 16.44$Earnings Power Value (EPV) 34.58$Discounted Cash Flow (DCF) 94.61$Ben Graham Formula 83.81$

Key Statistics Valuation RatiosMkt Cap ($M) 1,120.00$ P/E(TTM) 19.852 Wk High 100.93$ P/S(TTM) 2.352 Wk Low 63.02$% off 52Wk Low 35.5% P/Tang BV(MRQ) 6.1

FCF/EV (TTM) 6.9%

Cash Flows P/FCF(TTM) 16.3Owner Earnings FCF Earnings Yld (TTM) 8.5%

5 yr FCF Growth 31.4% Piotroski (TTM) 7

10 yr FCF Growth 14.6% Altman (MRQ) 7.83

Beneish (TTM) -2.68 Balance SheetEffectiveness Cash and Equiv 66.30$CROIC Margins & Profitability Short-Term Investments -$

Avg 6.8% Gross Accts Rec 26.50$

FCF/S Gross Margin Inventory 31.80$

Avg 2.6% Operating Total Current Assets 142.10$

ROA Operating Margin Net PP&E 139.80$

Avg 11.7% Net Profit Intangibles 1.38$

ROE Net Margin Total Assets 285.12$

Avg 16.8%

Financial Strength (MRQ) Total Current Liabilities 82.60$Efficiency Quick Ratio(MRQ) 1.3 Long-Term Debt -$Rec Turnover(TTM) 17.9 Current Ratio(MRQ) 1.7 Total Liabilities 103.26$

Inv Turnover(TTM) 7.4 LTD/Eq(MRQ) 0.0Asset Turnover(TTM) 1.7 Tot D/Eq(MRQ) 0.0

The Boston Beer Company, Inc. (Boston Beer) is a craft brewer in the United States.Boston Beer produces malt beverages and hard cider products at the Company-owned breweries and under contract arrangements at other brewery locations. TheCompany-owned breweries are located in Boston, Massachusetts (the BostonBrewery), Cincinnati, Ohio (the Cincinnati Brewery) and Breinigsville, Pennsylvania(the Pennsylvania Brewery). During the fiscal year ended December 25, 2010 (fiscal2010), Boston Beer sold approximately approximately 2.3 million barrels of itsproducts (core brands) and brewed or packaged approximately 13,000 barrels undercontract (non-core brands) for third-parties. During fiscal 2010, the Company soldover 20 beers under the Samuel Adams or the Sam Adams brand names, eight

flavored malt beverage products under the Twisted Tea brand name, and one hardcider product under the HardCore brand name.

August 11, 2011

0

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5Low Risk

High Growth

Under Valued

Well Managed

Good Financials

Strong Moat

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100

120

11/29/2004 11/29/2006 11/29/2008 11/29/2010

5 Yr Price vs I ntrinsic Value

Historical Price Intrinsic Value Buy Price


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on Beer Co Inc The

m) Figures in Millions except per share values

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM

me Statement 9 8 7 6 5 4 3 2 1 0 Revenue 186.8$ 215.4$ 207.9$ 217.2$ 238.3$ 285.4$ 341.6$ 398.4$ 415.1$ 463.8$ 476.3$

% change from prev year 15.3% -3.4% 4.5% 9.7% 19.8% 19.7% 16.6% 4.2% 11.7% 2.7%

Cost of Revenues 75.0$ 82.2$ 78.5$ 82.9$ 92.3$ 116.2$ 145.6$ 202.0$ 184.3$ 190.0$ 193.8$

COGS (%) 40.2% 38.2% 37.8% 38.2% 38.7% 40.7% 42.6% 50.7% 44.4% 41.0% 40.7% Gross Profit 111.7$ 133.1$ 129.4$ 134.3$ 146.0$ 169.3$ 196.0$ 196.4$ 230.7$ 273.8$ 282.5$

Gross Profit (%) 59.8% 61.8% 62.2% 61.8% 61.3% 59.3% 57.4% 49.3% 55.6% 59.0% 59.3%

Operating Expenses

Se ll ing, G ener al & Adm in. Expen ses 93. 7$ 14.6$ 14.6$ 14.8$ 17.3$ 22.7$ 24.6$ 35.0$ 158.5$ 174.8$ 189.1$

SG&A (%) 50.1% 6.8% 7.0% 6.8% 7.3% 7.9% 7.2% 8.8% 38.2% 37.7% 39.7%

Research & Development -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$R&D (%) 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

EBITDA 18.1$ 17.8$ 23.0$ 24.5$ 27.8$ 32.9$ 47.0$ 28.5$ 72.2$ 98.9$ 93.5$

EBITDA (%) 9.7% 8.3% 11.0% 11.3% 11.7% 11.5% 13.8% 7.2% 17.4% 21.3% 19.6% Other Special Charges -$ -$ -$ -$ -$ -$ 3.4$ 1.9$ 1.0$ 0.3$ 20.8$

Depreciation & Amortization 6.7$ 6.2$ 7.1$ 5.0$ 4.5$ 5.0$ 6.7$ 12.5$ 16.9$ 17.4$ 17.9$

D&A (%) 3.6% 2.9% 3.4% 2.3% 1.9% 1.7% 1.9% 3.1% 4.1% 3.8% 3.8%

Operating Income 11.4$ 11.7$ 15.9$ 19.5$ 23.3$ 28.0$ 40.3$ 16.0$ 55.3$ 81.5$ 75.6$Operating Income (%) 6.1% 5.4% 7.6% 9.0% 9.8% 9.8% 11.8% 4.0% 13.3% 17.6% 15.9%

Other Income and Expense

Interest Expense 0.0$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$Other Income 0.3$ 1.3$ 0.0$ (0.2)$ 0.4$ 0.7$ 0.5$ 0.2$ (0.0)$ (0.1)$ (0.1)$

Earnings Before Taxes 11.8$ 13.0$ 15.9$ 19.2$ 23.8$ 28.6$ 40.8$ 16.2$ 55.3$ 81.3$ 75.4$

Income Taxes/(Credit) 5.4$ 5.5$ 6.4$ 7.6$ 10.0$ 13.6$ 19.2$ 7.8$ 23.2$ 31.0$ 36.0$Tax Rate % 45.9% 42.4% 40.3% 39.5% 42.1% 47.5% 47.0% 48.2% 41.9% 38.1% 47.7%

Earnings After Taxes 6.4$ 7.5$ 9.5$ 11.6$ 13.8$ 15.0$ 21.6$ 8.4$ 32.1$ 50.3$ 39.4$

Minority Interest -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$Net Income From Continuing

Operations 7.8$ 8.6$ 10.6$ 12.5$ 15.6$ 18.2$ 22.5$ 8.1$ 31.1$ 50.1$ 59.6$

N et In co me F ro m D is co nt in ue d Ope ra ti on -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$

Net Income From Total Operations 7.8$ 8.6$ 10.6$ 12.5$ 15.6$ 18.2$ 22.5$ 8.1$ 31.1$ 50.1$ 59.6$Net Income (%) 4.2% 4.0% 5.1% 5.8% 6.5% 6.4% 6.6% 2.0% 7.5% 10.8% 12.5%

Shares and EPSTotal Basic EPS 0.48$ 0.53$ 0.72$ 0.89$ 1.10$ 1.31$ 1.58$ 0.58$ 2.21$ 3.67$ 4.48$Fully Diluted EPS 0.47$ 0.52$ 0.70$ 0.86$ 1.07$ 1.27$ 1.53$ 0.56$ 2.17$ 3.52$ 4.25$Basic Shares Outstanding 16.3 16.1 14.7 14.0 14.1 13.9 14.2 13.9 14.1 13.7 13.2Diluted Shares Outstanding 16.7 16.4 15.1 14.5 14.5 14.3 14.7 14.4 14.3 14.2

User Defined Shares Outstanding

nce Sheet MRQAssets

Cash & Equivalents 47.9$ 20.6$ 27.8$ 35.8$ 41.5$ 63.1$ 79.3$ 9.1$ 55.5$ 49.0$ 66.3$Short-Term Investments -$ 32.0$ 15.1$ 24.0$ 22.4$ 19.2$ 16.2$ -$ -$ -$ -$

Net Receivables 19.2$ 17.8$ 10.4$ 12.8$ 9.5$ 17.8$ 18.0$ 31.1$ 17.9$ 20.0$ 26.5$

% change from prev year -7.2% -41.5% 22.9% -25.7% 86.4% 1.1% 73.0% -42.6% 12.1% 22.5%

Inventories 9.3$ 8.3$ 9.9$ 12.6$ 13.6$ 17.0$ 18.1$ 22.7$ 25.6$ 26.6$ 31.8$

% change from prev year -10.5% 18.6% 27.0% 8.7% 24.8% 6.2% 25.5% 12.6% 4.1% -6.1%

Other Current Assets 4.1$ 4.8$ 4.6$ 2.6$ 2.1$ 3.4$ 4.2$ 6.0$ 14.1$ 16.4$ 17.6$

Total Current Assets 80.5$ 83.5$ 67.8$ 87.8$ 89.2$ 120.6$ 135.8$ 68.9$ 113.0$ 112.0$ 142.2$

Fixed Assets 23.9$ 20.2$ 17.1$ 17.2$ 26.5$ 30.7$ 46.2$ 147.9$ 147.0$ 142.9$ 139.8$

Intangible Assets 1.4$ 1.4$ 1.4$ 1.4$ 1.4$ 1.4$ 1.4$ 1.4$ 1.4$ 1.4$ 1.4$

Other Long-Term Assets 1.8$ 1.7$ 1.1$ 1.1$ 2.0$ 1.8$ 12.5$ 1.6$ 1.5$ 2.3$ 1.8$

Total Long-Term Assets 27.0$ 23.3$ 19.5$ 19.7$ 29.9$ 33.9$ 60.1$ 150.9$ 149.9$ 146.5$ 143.1$

Total Assets 107.5$ 106.8$ 87.4$ 107.5$ 119.1$ 154.5$ 195.9$ 219.8$ 262.9$ 258.5$ 285.3$

Liabilities & Stockholders' EquityAccounts payable 11.2$ 9.0$ 6.4$ 9.7$ 11.4$ 17.9$ 17.7$ 20.2$ 25.3$ 19.4$ 25.0$

Short-Term Debt -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$

Taxes Payable 13.2$ 15.9$ 15.5$ 16.5$ 17.4$ 22.9$ 40.4$ 44.4$ 48.5$ 52.8$ -$Accrued Liabilities 13.2$ 15.9$ 15.5$ 16.5$ 17.4$ 22.9$ 40.4$ 44.4$ 48.5$ 52.8$ 57.6$

Other Current Liabilities 13.2$ 15.9$ 15.5$ 16.5$ 17.4$ 22.9$ 40.3$ 46.9$ 48.5$ 52.8$ 57.6$

Total Current Liabilities 24.4$ 24.9$ 21.9$ 26.2$ 28.7$ 40.9$ 58.1$ 67.1$ 73.8$ 72.2$ 82.6$

Long-Term Debt -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$

Other Liabilities 1.3$ 0.7$ 0.7$ 0.8$ 1.9$ 3.5$ 3.0$ 3.1$ 2.6$ 3.7$ 3.3$

Deferred Income Taxes 3.6$ 2.4$ 2.2$ 2.1$ 2.4$ 1.5$ 1.2$ 9.6$ 13.4$ 17.1$ 17.4$Minority Interest -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$

Total Long-Term Liabilities 4.9$ 3.1$ 2.9$ 2.9$ 4.3$ 5.0$ 4.2$ 12.7$ 16.0$ 20.7$ 20.7$

Total Liabilities 29.3$ 28.0$ 24.8$ 29.1$ 33.1$ 45.9$ 62.3$ 79.7$ 89.8$ 92.9$ 103.3$

Retained Earnings 55.6$ 64.2$ 74.8$ 12.6$ 15.6$ 28.5$ 44.9$ 37.7$ 61.7$ 43.9$ 53.2$

Preferred Equity -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$

Total Equity 78.2$ 78.8$ 62.5$ 78.4$ 86.0$ 108.6$ 133.6$ 140.0$ 173.2$ 165.6$ 182.0$

Total Liabilities & Equity 107.5$ 106.8$ 87.4$ 107.5$ 119.1$ 154.5$ 195.9$ 219.8$ 262.9$ 258.5$ 285.3$

h Flows Statement TTMCash Flows From Operating ActivitiesNet Income 7.8$ 8.6$ 10.6$ 12.5$ 15.6$ 18.2$ 22.5$ 8.1$ 31.1$ 50.1$ 59.6$

Depreciation & Amortization 6.7$ 6.2$ 7.1$ 5.0$ 4.5$ 5.0$ 6.7$ 12.5$ 16.9$ 17.4$ 17.9$

Deferred Taxes -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$

Other 2.9$ (0.1)$ 0.5$ 2.2$ 7.8$ 6.5$ 26.4$ 11.5$ 15.4$ (4.2)$ 5.6$

Net Cash From Operating Activities 19.3$ 13.8$ 19.6$ 19.3$ 28.8$ 29.0$ 53.8$ 39.8$ 65.6$ 67.8$ 83.1$

Cash Flows From Investing ActivitiesCapital Expenditures (3.3)$ (2.3)$ (1.7)$ (4.6)$ (14.0)$ (9.1)$ (25.6)$ (59.5)$ (17.0)$ (13.6)$ (15.4)$

Acquisitions -$ -$ -$ -$ -$ -$ -$ (45.0)$ -$ -$ -$Sale of Assets 0.3$ (27.9)$ 16.7$ (9.3)$ 0.1$ 0.1$ (11.5)$ (45.0)$ -$ -$ -$Net Cash From Investing Activities (3.0)$ (30.3)$ 15.0$ (13.8)$ (13.8)$ (9.0)$ (37.1)$ (104.5)$ (17.0)$ (13.6)$ (15.4)$

Cash Flows From Financing ActivitiesIssuance of Capital Stock 0.5$ 1.0$ 2.4$ 2.6$ 3.0$ 4.5$ 3.4$ 5.3$ 2.8$ 3.7$ 1.9$

Repurchase of Capital Stock (4.1)$ (9.9)$ (29.8)$ -$ (12.5)$ (5.3)$ (6.1)$ (15.3)$ (7.1)$ (68.0)$ (60.4)$

Net Issuance of Stock -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$Issuance of Debt -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$

Repayment of Debt -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$

Net Issuance of Debt -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$

Dividends Paid -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$Cash from Financing (3.5)$ (8.8)$ (27.5)$ 2.6$ (9.3)$ 1.7$ (0.5)$ (5.6)$ (2.2)$ (60.8)$ (55.1)$

Cash at Beginning of the Period 35.1$ 45.8$ 20.6$ 27.8$ 35.8$ 41.5$ 63.1$ 79.3$ 9.1$ 55.5$ 45.3$

Cash at End of the Period 47.9$ 20.6$ 27.8$ 35.8$ 41.5$ 63.1$ 79.3$ 9.1$ 55.5$ 49.0$ 66.3$Change in Cash 12.8$ (25.2)$ 7.2$ 8.0$ 5.7$ 21.6$ 16.1$ (70.2)$ 46.4$ (6.5)$ 21.0$

Free Cash FlowCash from Operations 19.3$ 13.8$ 19.6$ 19.3$ 28.8$ 29.0$ 53.8$ 39.8$ 65.6$ 67.8$ 83.1$Cap Ex (3.3)$ (2.3)$ (1.7)$ (4.6)$ (14.0)$ (9.1)$ (25.6)$ (59.5)$ (17.0)$ (13.6)$ (15.4)$Free Cash Flow 16.0$ 11.5$ 17.9$ 14.7$ 14.9$ 19.9$ 28.2$ (19.7)$ 48.6$ 54.2$ 67.7$

Owner Earnings FCF 11.2$ 12.4$ 15.9$ 13.0$ 6.1$ 14.1$ 6.9$ (37.0)$ 32.0$ 54.3$ 82.9$User Defined

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ston Beer Co Inc The

m)

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM

ome StatementRevenue 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%

Cost of Revenues 40.2% 38.2% 37.8% 38.2% 38.7% 40.7% 42.6% 50.7% 44.4% 41.0% 40.7%

Gross Profit 59.8% 61.8% 62.2% 61.8% 61.3% 59.3% 57.4% 49.3% 55.6% 59.0% 59.3%

Operating Expenses

Selling, General & Admin. Expenses 50.1% 6.8% 7.0% 6.8% 7.3% 7.9% 7.2% 8.8% 38.2% 37.7% 39.7%

Research & Development 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

EBITDA 9.7% 8.3% 11.0% 11.3% 11.7% 11.5% 13.8% 7.2% 17.4% 21.3% 19.6%

Other Special Charges 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 1.0% 0.5% 0.2% 0.1% 4.4%

Depreciation & Amortization 3.6% 2.9% 3.4% 2.3% 1.9% 1.7% 1.9% 3.1% 4.1% 3.8% 3.8%

Operating Income 6.1% 5.4% 7.6% 9.0% 9.8% 9.8% 11.8% 4.0% 13.3% 17.6% 15.9%

Other Income and Expense

Interest Expense 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Other Income 0.2% 0.6% 0.0% -0.1% 0.2% 0.2% 0.1% 0.0% 0.0% 0.0% 0.0%

Earnings Before Taxes 6.3% 6.0% 7.6% 8.9% 10.0% 10.0% 12.0% 4.1% 13.3% 17.5% 15.8%

Income Taxes/(Credit) 2.9% 2.6% 3.1% 3.5% 4.2% 4.8% 5.6% 2.0% 5.6% 6.7% 7.6%

Earnings After Taxes 3.4% 3.5% 4.6% 5.4% 5.8% 5.3% 6.3% 2.1% 7.7% 10.9% 8.3%

Minority Interest 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%Net Income From Continuing

Operations 4.2% 4.0% 5.1% 5.8% 6.5% 6.4% 6.6% 2.0% 7.5% 10.8% 12.5%

Net Income From Discontinued

Operations 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Net Income From Total Operations 4.2% 4.0% 5.1% 5.8% 6.5% 6.4% 6.6% 2.0% 7.5% 10.8% 12.5%

lance Sheet MRQAssets

Cash & Equivalents 44.5% 19.3% 31.8% 33.3% 34.9% 40.9% 40.5% 4.1% 21.1% 18.9% 23.2%

Short-Term Investments 0.0% 30.0% 17.3% 22.3% 18.8% 12.4% 8.3% 0.0% 0.0% 0.0% 0.0%

Net Receivables 17.9% 16.7% 11.9% 11.9% 8.0% 11.5% 9.2% 14.1% 6.8% 7.7% 9.3%

Inventories 8.7% 7.8% 11.3% 11.7% 11.5% 11.0% 9.2% 10.3% 9.7% 10.3% 11.2%

Other Current Assets 3.8% 4.5% 5.3% 2.4% 1.7% 2.2% 2.2% 2.7% 5.4% 6.3% 6.2%

Total Current Assets 74.9% 78.2% 77.6% 81.7% 74.9% 78.0% 69.3% 31.3% 43.0% 43.3% 49.8%

Fixed Assets 22.2% 18.9% 19.5% 16.0% 22.3% 19.9% 23.6% 67.3% 55.9% 55.3% 49.0%

Intangible Assets 1.3% 1.3% 1.6% 1.3% 1.2% 0.9% 0.7% 0.6% 0.5% 0.5% 0.5%

Other Long-Term Assets 1.6% 1.6% 1.3% 1.0% 1.6% 1.2% 6.4% 0.7% 0.6% 0.9% 0.6%

Total Long-Term Assets 25.1% 21.8% 22.4% 18.3% 25.1% 22.0% 30.7% 68.7% 57.0% 56.7% 50.2%

Total Assets 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%

Liabilities & Stockholders' Equity

Accounts payable 10.4% 8.4% 7.3% 9.1% 9.6% 11.6% 9.0% 9.2% 9.6% 7.5% 8.8%

Short-Term Debt 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Taxes Payable 12.3% 14.9% 17.7% 15.4% 14.6% 14.8% 20.6% 20.2% 18.4% 20.4% 0.0%

Accrued Liabilities 12.3% 14.9% 17.7% 15.4% 14.6% 14.8% 20.6% 20.2% 18.4% 20.4% 20.2%

Other Current Liabilities 12.3% 14.9% 17.7% 15.3% 14.6% 14.8% 20.6% 21.3% 18.5% 20.4% 20.2%

Total Current Liabilities 22.7% 23.3% 25.1% 24.4% 24.1% 26.5% 29.6% 30.5% 28.1% 27.9% 28.9%

Long-Term Debt 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Other Liabilities 1.2% 0.7% 0.8% 0.7% 1.6% 2.3% 1.5% 1.4% 1.0% 1.4% 1.2%

Deferred Income Taxes 3.3% 2.3% 2.5% 1.9% 2.0% 1.0% 0.6% 4.4% 5.1% 6.6% 6.1%

Minority Interest 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Total Long-Term Liabilities 4.6% 2.9% 3.4% 2.7% 3.6% 3.2% 2.1% 5.8% 6.1% 8.0% 7.3%

Total Liabilities 27.3% 26.2% 28.4% 27.1% 27.8% 29.7% 31.8% 36.3% 34.1% 36.0% 36.2%

Retained Earnings 51.8% 60.1% 85.6% 11.7% 13.1% 18.4% 22.9% 17.1% 23.5% 17.0% 18.7%

Preferred Equity 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Total Equity 72.7% 73.8% 71.6% 72.9% 72.2% 70.3% 68.2% 63.7% 65.9% 64.0% 63.8%

Total Liabilities & Equity 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%

sh Flows Statement TTMCash Flows From Operating Activities

Net Income 40.6% 61.9% 53.8% 64.9% 53.9% 62.8% 41.8% 20.3% 47.5% 73.9% 71.7%

Depreciation & Amortization 34.5% 44.5% 36.2% 26.1% 15.7% 17.2% 12.4% 31.4% 25.8% 25.7% 21.6%

Deferred Taxes 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Other 15.0% -0.7% 2.5% 11.4% 27.0% 22.4% 49.1% 28.9% 23.5% -6.2% 6.7%

Net Cash From Operating Activities 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%

Cash Flows From Investing Activities

Capital Expenditures 109.5% 7.7% -11.5% 33.0% 100.9% 100.5% 69.0% 57.0% 100.0% 100.1% 100.0%

Acquisitions 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 43.0% 0.0% 0.0% 0.0%

Sale of Assets -10.0% 92.2% 111.4% 67.3% -0.7% -1.1% 31.0% 43.1% 0.0% 0.0% 0.0%

Net Cash From Investing Activities 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%

Cash Flows From Financing Activities

Issuance of Capital Stock -15.1% -11.5% -8.7% 100.0% -31.8% 269.8% -635.0% -94.7% -129.4% -6.0% -3.5%

Repurchase of Capital Stock 115.1% 112.5% 108.7% 0.0% 135.2% -317.0% 1120.4% 275.2% 326.4% 111.9% 109.7%

Net Issuance of Stock 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Issuance of Debt 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Repayment of Debt 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Net Issuance of Debt 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Dividends Paid 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Cash from Financing 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%

/2011



5/15


6/15

ston Beer Co Inc The

m) Color Coding

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

nancial Statistics & Ratios

Profitability Ratios

P/E 30.06 24.52 24.86 27.12 25.09 26.69 29.48 41.14 0.00 25.55

P/S 1.26 0.97 1.26 1.56 1.64 1.70 1.94 0.84 0.00 2.76

P/BV 3.01 2.66 4.20 4.33 4.54 4.47 4.96 2.38 0.00 7.74

P/Tang BV 3.07 2.71 4.29 4.40 4.61 4.53 5.01 2.40 0.00 7.80

P/CF 20.27 2.98 3.66 4.67 5.65 6.49 8.39 5.72 0.00 20.21

P/FCF 19.04 13.16 20.24 55.51 27.64 69.99 -17.89 10.39 0.00 15.45

ROE 10.0% 10.8% 16.9% 16.0% 18.1% 16.8% 16.8% 5.8% 18.0% 30.3%

ROA 7.3% 8.0% 12.1% 11.6% 13.1% 11.8% 11.5% 3.7% 11.8% 19.4%

SolvencyQuick Ratio 2.92 3.02 2.65 2.87 2.63 2.53 2.03 0.69 1.19 1.18

Current Ratio 3.30 3.36 3.10 3.35 3.10 2.95 2.34 1.03 1.53 1.55

Total Debt/Equity Ratio 0.37 0.35 0.40 0.37 0.38 0.42 0.47 0.57 0.52 0.56

Long Term Debt/Equity Ratio 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Short Term Debt/Equity Ratio 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Efficiency Ratios

Asset Turnover 1.74 2.02 2.38 2.02 2.00 1.85 1.74 1.81 1.58 1.79

Cash % of Revenue 25.6% 9.6% 13.4% 16.5% 17.4% 22.1% 23.2% 2.3% 13.4% 10.6%

Receivables % of Revenue 10.3% 8.3% 5.0% 5.9% 4.0% 6.2% 5.3% 7.8% 4.3% 4.3%

SG&A % of Revenue 50.1% 6.8% 7.0% 6.8% 7.3% 7.9% 7.2% 8.8% 38.2% 37.7%

R&D % of Revenue 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Liquidity Ratios

Receivables Turnover 0.41 0.46 0.75 1.08 1.39 1.33 1.26 0.33 1.27 2.65

Days Sales Outstanding 37.6 30.2 18.3 21.6 14.6 22.7 19.2 28.5 15.7 15.8

Inventory Turnover 8.05 9.31 8.61 7.39 7.04 7.57 8.29 9.90 7.64 7.29

Average Age of Inventory (Days) 45.35 39.21 42.39 49.40 51.82 48.20 44.02 36.86 47.79 50.10Intangibles % of Book Value 1.8% 1.7% 2.2% 1.8% 1.6% 1.3% 1.0% 1.0% 0.8% 0.8%

Inventory % of Revenue 5.0% 3.9% 4.8% 5.8% 5.7% 6.0% 5.3% 5.7% 6.2% 5.7%

Capital Structure Ratios

LT-Debt as % of Invested Capital 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

ST-Debt as % of Invested Capital 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

LT-Debt as % of Total Debt 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

ST-Debt as % of Total Debt 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%

Total Debt % of Total Assets 27.3% 26.2% 28.4% 27.1% 27.8% 29.7% 31.8% 36.3% 34.1% 36.0%

Working Capital % of Price 23.8% 28.0% 17.5% 18.2% 15.5% 16.4% 11.7% 0.5% 0.0% 3.1%

/2011



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Boston Beer Co Inc The Shares Out. M.O.S Growth Discount % Terminal % Select FCF Adjust 2010 FCF(sam) #VALUE! 13.22 14.0% 9.0%

8/11/2011Select input with

each list or enter 14.0%

Current Pr ice In tr insic $ Buy Under Actual M.O.S 52 Wk High 52 Wk Low

$85.40 $94.61 $70.96 10% $100.93 $63.02

Fiscal Year Trend 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM

Cash Flow DataCash from Operations $19.3 $13.8 $19.6 $19.3 $28.8 $29.0 $53.8 $39.8 $65.6 $67.8 $83.1Capex $3.3 $2.3 $1.7 $4.6 $14.0 $9.1 $25.6 $59.5 $17.0 $13.6 $15.4Cash Flow $11.6 $70.5 $71.8 $72.5 $69.1 $74.8 $79.0 $58.2 $41.3 $63.4 $39.3

Owner Earnings FCF $11.2 $12.4 $15.9 $13.0 $6.1 $14.1 $6.9 ($37.0) $32.0 $54.3 $82.9YOY% Change 10.2% 28.8% -18.6% -52.9% 131.3% -50.9% -634.0% -186.5% 69.4% 52.8%

MarginsGross Margin 59.8% 61.8% 62.2% 61.8% 61.3% 59.3% 57.4% 49.3% 55.6% 59.0% 59.3%Operating Margin 6.1% 5.4% 7.6% 9.0% 9.8% 9.8% 11.8% 4.0% 13.3% 17.6% 15.9%Net Margin 4.2% 4.0% 5.1% 5.8% 6.5% 6.4% 6.6% 2.0% 7.5% 10.8% 12.5%

EPS & TaxDiluted EPS $0.47 $0.52 $0.70 $0.86 $1.07 $1.27 $1.53 $0.56 $2.17 $3.52 $4.25Tax Rate 45.9% 42.4% 40.3% 39.5% 42.1% 47.5% 47.0% 48.2% 41.9% 38.1% 47.7%

Efficiency & ProfitabilityCROIC 13.5% 15.1% 24.3% 16.0% 6.8% 12.4% 5.0% -24.3% 16.9% 29.1% 40.9%FCF/Sales 6.0% 5.7% 7.7% 6.0% 2.6% 4.9% 2.0% -9.3% 7.7% 11.7% 17.4%Inventory Turnover 8.0 9.3 8.6 7.4 7.0 7.6 8.3 9.9 7.6 7.3 6.1Return On Assets (ROA) 7.3% 8.0% 12.1% 11.6% 13.1% 11.8% 11.5% 3.7% 11.8% 19.4% 20.9%Retun On Equity (ROE) 10.0% 10.8% 16.9% 16.0% 18.1% 16.8% 16.8% 5.8% 18.0% 30.3% 32.7%

Debt RelatedDebt to Equity 37.5% 35.5% 39.7% 37.1% 38.5% 42.3% 46.6% 56.9% 51.9% 56.1% 56.7%Capitalization Ratio 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%FCF to Total Debt 38.3% 44.2% 64.2% 44.6% 18.5% 30.8% 11.1% -46.5% 35.7% 58.4% 80.3%FCF to Short Term DebtFCF to Long Term Debt

2005-2009 2006-2010 2005-2008 2006-2009 2007-2010 2005-2007 2006-2008 2007-2009 2008-2010 Median

Tang Shareholder Equity 19.4% 11.2% 17.9% 17.0% 7.5% 25.0% 13.7% 14.0% 8.8% 14.0%Owner Earnings FCF 51.3% 40.0% 0.0% 31.4% 98.5% 6.6% 0.0% 114.9% 0.0% 31.4%CROIC 6.8% 12.4% 5.9% 8.7% 11.0% 6.8% 5.0% 5.0% 16.9% 6.8%FCF/Sales 2.6% 4.9% 2.3% 3.5% 4.9% 2.6% 2.0% 2.0% 7.7% 2.6%ROA 11.8% 11.8% 11.6% 11.6% 11.7% 11.8% 11.5% 11.5% 11.8% 11.7%ROE 16.8% 16.8% 16.8% 16.8% 17.4% 16.8% 16.8% 16.8% 18.0% 16.8%Gross Margin 57.4% 57.4% 58.3% 56.5% 56.5% 59.3% 57.4% 55.6% 55.6% 57.4%Operating Margin 9.8% 11.8% 9.8% 10.8% 12.6% 9.8% 9.8% 11.8% 13.3% 10.8%Net Margin 6.5% 6.6% 6.5% 6.5% 7.0% 6.5% 6.4% 6.6% 7.5% 6.5%Revenue Growth 14.9% 12.9% 18.7% 13.3% 10.7% 19.7% 18.1% 10.2% 7.9% 13.3%Earnings Growth 19.3% 29.0% -19.4% 19.6% 32.0% 19.6% -33.6% 19.1% 150.7% 19.6%Cash from Ops Growth 22.8% 23.7% 11.4% 31.3% 8.0% 36.6% 17.3% 10.4% 30.5% 22.8%

10 Year Multi-Year Performance2001-2008 2002-2009 2003-2010 2001-2006 2002-2007 2003-2008 2004-2009 2005-2010 2001-2010 Median

Tang Shareholder Equity 8.8% 12.1% 15.2% 6.9% 11.3% 17.8% 17.4% 14.2% 16.4% 14.2%Owner Earnings FCF 0.0% 14.6% 19.1% 4.7% -10.9% 0.0% 19.8% 54.8% 37.1% 14.6%CROIC 13.0% 13.8% 14.2% 14.3% 13.8% 9.6% 9.6% 9.6% 12.4% 13.0%FCF/Sales 5.3% 5.3% 5.5% 5.9% 5.3% 3.8% 3.8% 3.8% 5.9% 5.3%ROA 11.6% 11.7% 11.8% 11.7% 11.7% 11.7% 11.7% 11.8% 11.7% 11.7%ROE 16.4% 16.8% 16.9% 16.4% 16.8% 16.8% 16.8% 17.4% 16.8% 16.8%Gross Margin 60.5% 60.3% 59.2% 61.5% 61.5% 60.3% 58.3% 58.2% 59.6% 60.3%Operating Margin 8.3% 9.4% 9.8% 8.3% 9.4% 9.4% 9.8% 10.8% 9.4% 9.4%Net Margin 5.4% 6.1% 6.5% 5.4% 6.1% 6.1% 6.5% 6.6% 6.1% 6.1%

Revenue Growth 11.4% 9.8% 12.1% 8.9% 9.7% 13.9% 13.8% 14.2% 19.9% 12.1%Earnings Growth 2.5% 22.6% 26.0% 22.0% 24.1% -4.4% 20.3% 26.9% 49.6% 22.6%Cash from Ops Growth 10.9% 24.9% 19.4% 8.5% 31.2% 15.2% 27.7% 18.7% 28.6% 19.4%

Projection of future Free Cash Flow2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Yearly Growth Input Field14% $61.86 $70.52 $80.39 $87.23 $98.22 $110.59 $124.52 $128.14 $142.68 $158.85Terminal Growth 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 5% 166.80$ 175.14$ 183.89$ 193.09$ 202.74$ 212.88$ 223.52$ 234.70$ 246.44$ 258.76$

Calculation Sensitivity Matrix: Growth vs Discount RateTotal Cash

MAX(0,Current Liabilities-Current A 7% 8% 9% 10% 11%Excess Cash 10% 90.76$ 83.08$ 76.34$ 70.41$ 65.17$

Adding some Intangibles 12% 101.49$ 92.67$ 84.95$ 78.16$ 72.17$

Present Value 14% 113.55$ 103.45$ 94.61$ 86.84$ 80.00$Shares Outstanding 16% 127.09$ 115.54$ 105.44$ 96.57$ 88.76$Per Share Value 18% 142.29$ 129.10$ 117.56$ 107.45$ 98.55$

Margin of Safety

Purchase Price Sensitivity Matrix: Margin of Safety %Current Price

Actual M.O.S 7% 8% 9% 10% 11%10% 5.9% -2.8% -11.9% -21.3% -31.0%

Variable Fields 12% 15.9% 7.8% -0.5% -9.3% -18.3%

Intangibles% add to DCF 14% 24.8% 17.4% 9.7% 1.7% -6.7%Decay Rate (Yr4E-Yr7E) 16% 32.8% 26.1% 19.0% 11.6% 3.8%Extra Decay (Yr8E-Yr10E) 18% 40.0% 33.8% 27.4% 20.5% 13.3%

13.2294.61$

1,250.74$

10%

10%

5%25%

25%

70.96$

85.40$

Owner Earnings

66.32$

-$

5 Year Multi-Year Performance

-$

0%

Discount Rates

Growth Rates

66.32$

10%

Discount Rates

Growth Rates

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8/15

Shares Out. M.O.S Growth Projection EPS Corp Bond

(sam) #VALUE! 23.0% $2.13 4.64

8/11/2011

Current Price Intrinsic $ Buy Under Actual M.O.S 52 Wk High 52 Wk Low

$85.40 $83.81 $28.49 -2% $100.93 $63.02

2005-2009 2006-2010 2005-2008 2006-2009 2007-2010 2005-2007 2006-2008 2007-2009 2008-2010 Median5 Yr EPS Growth 19.3% 29.0% -19.4% 19.6% 32.0% 19.6% -33.6% 19.1% 150.7% 19.6%

2001-2008 2002-2009 2003-2010 2001-2006 2002-2007 2003-2008 2004-2009 2005-201010 Yr EPS Growth 2.5% 22.6% 26.0% 22.0% 24.1% -4.4% 20.3% 26.9%

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM

Diltued EPS 0.47$ 0.52$ 0.70$ 0.86$ 1.07$ 1.27$ 1.53$ 0.56$ 2.17$ 3.52$ 4.2$2011E 2012E

Forecast Method 2.37$ 2.92$Linear Regression Method 2.13$ 2.62$

Normal Earnings 2.13$

Growth Rate 23.02%

Corp Bond Rate 4.64

Per Share Value 83.81$

MOS 66%

Purchase Price 28.49$

Current Price $85.40Actual Discount -2%

Median22.6%

Graham Value Calculation

66%13.22Linear

Regression

Boston Beer Co Inc Th

Enter TickerRefresh CLEAR

$0.47 $0.52$0.70 $0.86

$1.07$1.27

$1.53

$0.56

$2.17

$3.52

$2.13

$2.62

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011E 2012E

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9/15

Boston Beer Co Inc The Shares Out. Source Normalized Income Discount Rate R&D Years SG&A %

(sam)#VALUE! 13.22 $51.76 25%

8/11/2011Figures in Millions except per share values

Current Price EPV Net Reproduction Value EPV MOS NCAV 52 Wk High 52 Wk Low

$85.40 $34.58 $16.44 -147.0% $1.61 $100.93 $63.02

Asset Valuation Section EPV Valuation Section

Data: Asset ValuationShares Outstanding 13.2 2010 Owner Earnings FCF 54.3$

Balance Sheet Assets 285.1$ Normalized Income 51.8$Adjusted Assets 285.1$ Avg Adj. Income 5 yrs 50.1$Total Liabilities 103.3$ TTM Adjusted Income 91.4$

Total Equity 181.9$

Average SGA % 20.0% Data: EPVMarketing/Brand Value 92.6$ Cost of Capital 9.0%

R&D Value -$ Normalized Adjusted Income 51.8$

Cash Needed for Business 4.8$ Average Maintenance Capex 16.2$Interest Bearing Debt -$ Interest Bearing Debt -$Non Interest Bearing Debt 103.3$ 1% of sales 4.8$Excess Cash 57.0$ Cash & Equiv 66.3$

Cash - Debt 61.5$

Calculation: Asset Valuation Shares 13.22Total Per Share

Tangible BV 180$ 13.65$ Calculation: EPVAdjusted BV 182$ 13.76$ Cost of Capital Rates EPV Per Share + Cash - Debt Per ShareNCAV 21$ 1.61$ 5% 712.1$ 53.87$ 773.7$ 58.52$Reprod. Cost of Assets 378$ 28.57$ 7% 508.7$ 38.48$ 570.2$ 43.13$

Reprod. Cost of Assets BV 274$ 20.76$ 9% 395.6$ 29.93$ 457.2$ 34.58$Total Net Reprod. Cost 217$ 16.44$ 11% 323.7$ 24.48$ 385.2$ 29.14$

13% 273.9$ 20.72$ 335.4$ 25.37$

Quarterly numbers based on: Error Statement Source Date: 2-Aug-11Adjustments:Assets Book Value Fixed BV Multipl ier

ReproductionAsset Value

Cash & Equivalents 66.3$ 66.3$

Adjustments:

Liabilities & Equity Book Value Fixed BV MultiplierReproductionLiability Value

Marketable Securities -$ -$ Accounts Payable 25.0$ 25.0$Accounts Receivable - Gross 26.5$ 26.5$ Accrued Expenses -$ -$Other Receivable -$ -$ Accrued Liabilities 57.6$ 57.6$

Receivables 26.5$ 26.5$ Notes Payable/Short Term Debt -$ -$

Inventories: Raw Materials 20.4$

Current Port. of LT Debt/CapitalLeases -$ -$

Inventories: Work in Progress 5.3$ Other Current Liabilities -$ -$

Inventories: Purchased Components -$ Total Current Liabilities 82.6$ 82.6$Inventories: Finished Goods 6.1$ Long-Term Debt -$ -$Inventories: Other -$ Capital Lease Obligations -$ -$

Inventories -- Total 31.8$ 31.8$ Deferred Income Taxes 17.4$ 17.4$Prepaid Expenses 13.9$ 13.9$ Minority Interest -$ -$Current Defered Income Taxes 3.6$ 3.6$ Total Other Liabilities 3.3$ 3.3$

Other Current Assets -$ -$ Total Liabilities 103.3$ 103.3$Total Current Assets 142.1$ 142.1$ Common Stock Equity 182.0$ 182.0$Goodwill, Net 1.4$ 1.4$ Retained Earnings 53.2$ 53.2$Intangibles, Net -$ -$ Total Capitalization 182.0$ 182.0$

Intangibles 1.4$ 1.4$ Total Equity 182.0$ 181.9$Property/Plant/Equipment - Net 139.8$ 139.8$ Total Liabilities & Equity 285.3$ 285.3$

Long Term Investments -$ -$Note Receivable - Long Term -$ -$Other Long Term Assets, Total 1.8$ 1.8$Total Assets 285.1$ 285.1$

9% 3ADVFN

Values for Normalized Income

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10/15

(sam)8/11/2011 Current Price NNWC NNWC % NCAV NCAV % Data

$85.40 -$0.09 -97615.7% $2.95 -2799.6% Statements

Numbers as of 2011/06 (go to SEC for accurate numbers)

Figures in Millions except per share values BV

BV

Multiplier Net Net ValueCash & Equivalents 66.32$ 100% 66.32$

Marketable Securities -$Accounts Receivable 26.50$ 75%Other Receivable -$

Receivables 26.50$ 19.88$

Inventories: Raw Materials -$ 50%Inventories: Work in Progress -$Inventories: Purchased Components -$Inventories: Finished Goods -$Inventories: Other -$

Inventories -- Total 31.83$ 15.91$Current Assets - Total 142.20$ 142.20$Total Liabilities 103.26$ 103.26$Shares Outstanding 13.22 13.22

Total ($m) Per ShareTotal Current Assets 142.20$ 10.76$

Market Cap & Share Price 1,120.00$ 85.40$Net Net Working Capital (1.16)$ (0.09)$

Discount to NNWC -97616%Net Current Asset Value 38.94$ 2.95$

Discount to NCAV -2800%

Boston Beer Co Inc The

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11/15

Boston Beer Co Inc The(sam)8/11/2011

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM

Piotroski F Scores 6 8 7 5 4 4 3 5 7 8 7

Piotroski 1: Net Income 1 1 1 1 1 1 1 1 1 1 1

Piotroski 2: Operating Cash Flo 1 1 1 1 1 1 1 1 1 1 1

Piotroski 3: Return on Assets 1 1 1 0 1 0 0 0 1 1 1

Piotroski 4: Quality of Earnings 1 1 1 1 1 1 1 1 1 1 1

Piotroski 5: LT Debt vs Assets 0 0 0 0 0 0 0 0 0 0 0

Piotroski 6: Current Ratio 1 1 0 1 0 0 0 0 1 1 1

Piotroski 7: Shares Outstanding 1 1 1 1 0 1 0 1 1 1 1

Piotroski 8: Gross Margin 0 1 1 0 0 0 0 0 1 1 1Piotroski 9: Asset Turnover 0 1 1 0 0 0 0 1 0 1 0

MRQ2001/12 2002/12 2003/12 2004/12 2005/12 2006/12 2007/12 2008/12 2009/12 2010/12 2011/06

Working Capital 56$ 59$ 46$ 62$ 60$ 80$ 78$ 2$ 39$ 40$ 60$

Total Assets 107$ 107$ 87$ 107$ 119$ 154$ 196$ 220$ 263$ 259$ 285$

Total Liabilities 29$ 28$ 25$ 29$ 33$ 46$ 62$ 80$ 90$ 93$ 103$

Retained Earnings 56$ 64$ 75$ 13$ 16$ 28$ 45$ 38$ 62$ 44$ 53$

EBITDA 12$ 13$ 16$ 19$ 24$ 29$ 41$ 16$ 55$ 81$ 24$

Market Value of Equity 230$ 201$ 244$ 333$ 373$ 478$ 640$ 327$ #VALUE! 1,130$ 1,130$

Net Sales 187$ 215$ 208$ 217$ 238$ 285$ 342$ 398$ 415$ 464$ 134$

Normal Altman Z Score 8.16 8.24 10.69 10.34 10.22 9.58 9.40 4.77 10.55 7.83 Revised Altman Z Score 14.09 13.94 17.76 17.38 16.95 16.17 15.55 5.42 16.44 14.04

X1 0.15 0.21

X2 0.17 0.19

X3 0.31 0.09

X4 12.16 10.94X5 1.79 0.47

Altman Z Score

MRQ EditAnnual

10.55 7.83

Revised Altman Z Score

Annual

Piotroski Score

Annual MRQ

16.44 14.04

X2 = Retained Earnings/Total AssetsX3 = EBITDA/Total Assets

X4 = Market Value of Equity/Total Liabilities

The Z-score formula may be used to predict the probability that a firm will go into bankruptcy within two years.

Z-scores are used to predict corporate defaults and an easy-to-calculate control measure for the f inancial distress status of companies in academic studies. The Z-score uses multiple corporate

income and balance sheet values to measure the financial health of a company.

The main problem with the Altman Z formula is that the formula is not suited for many industries. Industries that operate with high leverage, such as radio and utilities will show a higher r isk of

bankruptcy.

Also, industries with negative working capital, such as many retail and restaurant companies will also exhibit the same high level of bankruptcy.

(Wikipedia http://en.wikipedia.org/wiki/Z-Score_Financial_Analysis_Tool)

Z = 1.2*X1 + 1.4*X2 + 3.3*X3 + 0.6*X4 + 1.0*X5

There is also a revised Altman Z score which is adjusted for non manufacturing corporations. The revised formula is:

Z = 6.56*X1 + 3.26*X2 + 6.72*X3 + 1.05*X4

X1 = Working Capital/Total Assets

A discrete score between 0-9 which reflects nine criteria used to determine the strength of a firm's financial position. The Piotroski score is used to determine the best value stocks, nine being thebest. The score was named after Chicago Accounting Professor, Joseph Piotroski who devised the scale according to specific criteria found in the financial statements. For every criteria (below) that

is met the company is given one point, if it is not met, then no points are awarded. The points are then added up to determine the best value stocks.

Profitability

* Positive return on assets in the current year (1 point)

* Positive operating cash flow in the current year (1 point)

* Higher return on assets (ROA) in the current period compared to the ROA in the previous year (1 point)

* Cash flow from operations are greater than ROA (1 point)

Leverage, Liquidity and Source of Funds

* Lower ratio of long term debt to in the current period compared value in the previous year (1 point)

* Higher current ratio this year compared to the previous year (1 point)* No new shares were issued in the last year (1 point)

Operating Efficiency

* A higher gross margin compared to the previous year (1 point)

* A higher asset turnover ratio compared to the previous year (1 point)

MRQ

X5 = Net Sales/Total Assets

Altman Z Score

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12/15

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM

M Score - 5 Variable NA -3.01 -3.30 -2.81 -2.92 -2.44 -1.44 -2.67 -3.50 -2.72 -2.79

M Score - 8 Variable NA -2.64 -3.42 -2.60 -3.06 -2.25 -2.22 -2.78 -4.18 -2.61 -2.68

DSRI 0.80 0.61 1.18 0.68 1.56 0.84 1.48 0.55 1.00 1.29 0.00

GMI 0.97 0.99 1.01 1.01 1.03 1.03 1.16 0.89 0.94 1.00 0.00

AQI 0.99 0.99 0.81 1.22 0.74 3.40 0.19 0.81 1.28 0.80 0.00

SGI 1.15 0.97 1.04 1.10 1.20 1.20 1.17 1.04 1.12 1.03 0.00

DEPI 0.93 0.79 1.30 1.55 1.04 1.11 1.62 0.76 0.95 0.96 0.00

SGAI 0.14 1.04 0.97 1.06 1.09 0.91 1.22 4.35 0.99 1.05 0.00

TATA -0.05 -0.10 -0.06 -0.11 -0.07 -0.16 -0.14 -0.13 -0.07 -0.08 0.00LVGI 1.03 1.08 0.97 0.99 1.10 1.12 1.03 0.92 1.00 1.04 0.00

Revised Altman Z Score

The Beneish Model - M Score VariablesDSRI = Days' Sales in Receivables Index. Measured as the ratio of days' sales in receivables in year t to year t-1. A large increase in DSR could be indicative of revenue inflation.

GMI = Gross Margin Index. Measured as the ratio of gross margin in year t-1 to gross margin in year t. Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is

more likely to manipulate earnings.

AQI = Asset Quality Index. Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.AQI is the ratio of asset quality in year t to year t-1.

SGI = Sales Growth Index. Ratio of sales in year t to sales in year t-1. Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressureto manipulate in order to keep up appearances.

DEPI = Depreciation Index. Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t. DEPI gr eater than 1 indicates that assets are being depreciated at a slowerrate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

SGAI = Sales, General and Administrative expenses Index. The ratio of SGA expenses in year t relative to year t -1.

LVGI = Leverage Index. The ratio of total debt to total assets in year t relative to yeat t-1. An LVGI >1 indicates an increase in leverage

TATA - Total Accruals to Total Assets. Total accruals calculated as the change in working capital accounts other than cash less depreciation.

The Beneish M Score FormulaThe eight variables are then weighted together according to the following:

M = -4.84 + 0.92*DSRI + 0.528*GMI + 0.404*AQI + 0.892*SGI + 0.115*DEPI - 0.172*SGAI + 4.679*TATA - 0.327*LVGI

A score greater than -2.22 indicates a strong likelihood of a firm being a manipulator. In his out of sample tests, Beneish found that he could correctly identify 76% of manipulators, whilst only

incorrectly identifying 17.5% of non-manipulators.

The 5 Variable Version of the Beneish ModelThe five variable version excludes SGAI, DEPI and LEVI which w ere not significant in the original Beneish model.

M = -6.065 + 0.823*DSRI + 0.906*GMI + 0.593*AQI + 0.717*SGI + 0.107*DEPI

A score greater than -2.22 indicates a strong likelihood of a firm being a manipulator.

Original Altman Z Score

When Z is 2.6 or more, the firm is most likely safe based on the f inancial data. However, be careful to double check as fraud, economic downturns and other factors could cause unexpectedreversals.

When Z is 1.1 to 2.6, the company is probably safe from bankruptcy, but this is in the grey area and caution should be taken.

When Z is below 1.1, the company is highly likely to be bankrupt. If a company is generating lower than 1.8, serious studies must be performed to ensure the company can survive.

When Z is 3.0 or more, the firm is most likely safe based on the financial data. However, be careful to double check as fraud, economic downturns and other factors couldcause unexpected reversals.

When Z is 2.7 to 3.0, the company is probably safe from bankruptcy, but this is in the grey area and caution should be taken.

When Z is 1.8 to 2.7, the company is likely to be bankrupt within 2 years. This is the lower portion of the grey area and a dramatic turnaround of the company is needed.

When Z is below 1.8, the company is highly likely to be bankrupt. If a company is generating lower than 1.8, serious studies must be performed to ensure the company can

survive.


13/15

Boston Beer Co Inc The(sam)8/11/2011

sam hook hinky bud tap sbmry

Sorted Data sam bud tap sbmry hinky hookStock Price $ 85.40 $ 51.51 $ 42.51 $ 34.28 $ 26.80 $ 5.93Mkt Cap ($M) $ 1,120.00 $ 82,710.00 $ 7,960.00 $ - $ 30,870.00 $ 111.62EV $ 1,050.00 $ 118,950.00 $ 8,480.00 $ 58,530.00 $ 42,420.00 $ 128.7552 Wk High $ 100.93 $ 64.77 $ 51.11 $ 38.68 $ 30.86 $ 10.1752 Wk Low $ 63.02 $ 49.05 $ 40.52 $ 28.10 $ 21.65 $ 5.25% off 52Wk Low 35.5% 5.0% 4.9% 22.0% 23.8% 13.0%

MultiplesP/E(TTM) 19.8 17.7 11.4 0.0 27.0 59.2P/S(TTM) 2.3 2.2 2.3 0.0 1.3 0.7P/Tang BV(MRQ) 6.1 0.0 4.2 0.0 0.0 1.6P/CF 14.3 8.8 8.6 0.0 8.1 11.8P/FCF(TTM) 16.3 0.0 36.6 0.0 14.7 26.4EV/EBITDA(TTM) 11.2 8.6 13.8 12.6 9.3 12.7

DividendsDiv Yld 0.0% 2.4% 3.1% 0.0% 2.0% 0.0%Div Yld - 5yr avg 0.0% 0.0% 0.0% 0.0% 1.9% 0.0%Div 5yr Grth 0.0% 0.0% 11.0% 0.0% 13.7% 0.0%Payout Ratio(TTM) 0.0% 0.0% 27.8% 0.0% 60.8% 0.0%

Growth RatesSales(MRQ) v 1yr ago 3.4% 8.1% 5.7% 0.0% 13.9% 17.7%Sales(TTM) v 1yr ago 2.3% 2.2% 2.3% 0.0% 1.3% 0.7%Sales 5yr Grth 14.3% 0.0% -10.0% 0.0% 8.6% 33.5%EPS(MRQ) v 1yr ago 77.7% 102.7% -6.4% 0.0% -96.1% -93.0%EPS(TTM) v 1yr ago 51.5% 2.5% -12.0% 0.0% -34.7% -29.3%EPS 5yr Grth 26.9% 0.0% 19.9% 0.0% 10.4% 0.0%

Balance SheetQuick Ratio(MRQ) 1.3 0.0 1.2 0.0 0.6 0.5Current Ratio(MRQ) 1.7 0.0 1.3 0.0 0.8 0.9LTD/Eq(MRQ) 0.0 0.0 24.0 0.0 79.0 27.0Tot D/Eq(MRQ) 0.0 0.0 24.6 0.0 88.7 29.3

MarginsGross %(TTM) 55.6% 55.8% 43.5% 0.0% 36.2% 26.4%Gross % 5yr 52.9% 0.0% 41.3% 0.0% 67.0% 20.5%Op %(TTM) 20.1% 27.8% 26.6% 0.0% 13.9% 1.8%Op % 5yr avg 11.3% 0.0% 14.9% 0.0% 12.0% -7.7%Net %(TTM) 12.5% 17.3% 20.3% 0.0% 9.6% 1.1%Net % 5yr avg 6.8% 0.0% 11.8% 0.0% 7.7% -7.5%

ReturnsROA(TTM) 21.6% 0.0% 5.4% 0.0% 6.7% 1.0%ROA 5yr avg 12.7% 0.0% 4.6% 0.0% 6.3% -5.7%ROE(TTM) 33.6% 0.0% 8.7% 0.0% 9.2% 1.7%ROE 5yr avg 19.1% 0.0% 8.2% 0.0% 17.1% -8.7%

EfficiencyRec Turnover(TTM) 17.9 0.0 5.4 0.0 7.0 12.5Inv Turnover(TTM) 7.4 0.0 8.3 0.0 9.3 9.9Asset Turnover(TTM) 1.7 0.0 0.3 0.0 0.7 0.9

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Boston Beer Co Inc The

Figures in Millions except per share valu

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM$16.0 $11.5 $17.9 $14.7 $14.9 $19.9 $28.2 -$19.7 $48.6 $54.2 $67.7 $11.2 $12.4 $15.9 $13.0 $6.1 $14.1 $6.9 -$37.0 $32.0 $54.3 $82.9

% Change -28.3% 56.0% -17.9% 1.0% 34.0% 41.5% -169.9% 346.6% 11.6% 24.8% % Change 10.2% 28.8% -18.6% -52.9% 131.3% -50.9% -634.0% 186.5% 69.4% 52.8%

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM$14.1 $12.8 $17.4 $23.3 $26.9 $33.9 $45.1 $23.0 #VALUE! $89.9 $88.7 $0.47 $0.52 $0.70 $0.86 $1.07 $1.27 $1.53 $0.56 $2.17 $3.52 $1.09

% Change -9.8% 36.5% 34.0% 15.1% 26.3% 33.0% -48.9% #VALUE! #VALUE! -1.4% % Change 10.6% 34.6% 22.9% 24.4% 18.7% 20.5% -63.4% 287.5% 62.2% -69.0%

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM

6.0% 5.7% 7.7% 6.0% 2.6% 4.9% 2.0% -9.3% 7.7% 11.7% 17.4% 14.4 17.5 13.6 22.7 25.1 24.0 22.7 -16.6 #VALUE! 22.2 17.3% Change -4.4% 33.4% -22.1% -57.1% 93.1% -59.0% -557.9% 183.0% 51.6% 48.8% % Change 21.9% -22.5% 66.6% 10.8% -4.4% -5.3% -173.1% #VALUE! #VALUE! -22.2%

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM13.5% 15.1% 24.3% 16.0% 6.8% 12.4% 5.0% -24.3% 16.9% 29.1% 40.9% 6.9% 5.7% 7.4% 4.4% 4.0% 4.2% 4.4% -6.0% #VALUE! 4.5% 5.8%

% Change 11.8% 61.3% -34.4% -57.6% 83.9% -59.5% -581.9% 169.8% 71.9% 40.5% % Change -18.0% 29.0% -40.0% -9.7% 4.6% 5.6% -236.8% #VALUE! #VALUE! 28.5%

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM9.9% 12.0% 11.4% 9.0% 9.0% 8.3% 8.6% 9.0% #VALUE! 8.6% 8.5% 14.7% 16.4% 25.2% 24.4% 27.3% 25.9% 32.9% 10.8% 29.7% 44.5% 37.8%

% Change 20.7% -4.4% -21.8% 0.5% -7.5% 3.5% 3.9% #VALUE! #VALUE! -1.0% % Change 11.9% 53.3% -3.1% 11.8% -5.1% 27.1% -67.2% 174.9% 49.9% -15.0%

Magic Formula Investing -- Earnings Yield Magic Formula Investing -- Return on Capital

Owner Earnings

Cash Return on Invested Capital (CROIC) FCF Yield

(sam)8/11/2011

Diluted EPS

FCF / Sales Price / FCF

Free Cash Flow

Stock Price



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2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM59.8% 61.8% 62.2% 61.8% 61.3% 59.3% 57.4% 49.3% 55.6% 59.0% 59.3% 4.2% 4.0% 5.1% 5.8% 6.5% 6.4% 6.6% 2.0% 7.5% 10.8% 12.5%

% Change 3.3% 0.7% -0.7% -0.9% -3.2% -3.3% -14.1% 12.8% 6.2% 0.5% % Change -5.3% 27.8% 13.4% 13.4% -2.4% 3.3% -69.2% 269.3% 44.2% 15.7%

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM6.0 8.0 7.0 5.0 4.0 4.0 3.0 5.0 7.0 8.0 7.0 8.2 8.2 10.7 10.3 10.2 9.6 9.4 4.8 10.5 7.8

% Change 33.3% -12.5% -28.6% -20.0% 0.0% -25.0% 66.7% 40.0% 14.3% -12.5% % Change 0.9% 29.8% -3.3% -1.1% -6.2% -1.9% -49.3% #VALUE! #VALUE! -25.8%

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM-2.6 -3.4 -2.6 -3.1 -2.2 -2.2 -2.8 -4.2 -2.6 -2.7 45.9% 42.4% 40.3% 39.5% 42.1% 47.5% 47.0% 48.2% 41.9% 38.1% 47.7%

% Change #DIV/0! -29.5% 24.2% -17.9% 26.6% 1.4% -25.4% -50.5% 37.6% -2.8% % Change -7.7% -5.0% -1.9% 6.5% 12.9% -1.0% 2.6% -13.0% -9.1% 25.2%

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM37.5% 35.5% 39.7% 37.1% 38.5% 42.3% 46.6% 56.9% 51.9% 56.1% 56.7% 38.3% 44.2% 64.2% 44.6% 18.5% 30.8% 11.1% -46.5% 35.7% 58.4% 80.3%

% Change -5.4% 11.9% -6.5% 3.6% 9.8% 10.3% 22.2% -8.9% 8.3% 1.1% % Change 15.5% 45.2% -30.5% -58.6% 66.7% -63.8% -517.0% 176.8% 63.6% 37.5%

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 TTM

% Change #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! % Change #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALUE! #VALU

Debt to Equity FCF to Total Debt

FCF to Short Term Debt FCF to Long Term Debt

Gross Margin Net Profit Margin

Piotroski F score Original Altman Z Score

Beneish M Score - 8 Variable Version Tax Rate

Documents

SAM Aug 2011 Valuation