© Associated PressBud Light sales have steadily declined since the April 1 Dylan Mulvaney posts went viral.
Carlos Laboy, a managing director at HSBC's global beverage sector, downgraded the stock of Anheuser-Busch InBev to a hold status — meaning that investors should neither buy or sell shares of the company.
Laboy said that the backlash to the Mulvaney branding partnership is a sign that there are "deeper problems than ABI admits," according to a note that was first reported by CNBC.
"Is ABI's leadership getting the brand culture transformation right? It's mixed," Laboy wrote in a note that was published on Wednesday.
"At Ambev, we think the answer is 'yes;' in the US, we think it's 'no'," Laboy wrote.
"The way this Bud Light crisis came about a month ago, management's response to it and the loss of unprecedented volume and brand relevance raises many questions."
"Why did its US leadership underestimate the risk of pushback given the recent experience of other firms?" Laboy wrote.
"Is A-B hiring the best people to grow the brands and gauge risk?"
"If Budweiser and Bud Light are iconic American ideas that have long brought consumers together, why did these marketers fail to invite new consumers without alienating the core base of the firm's largest brand?" Laboy asked.
Ambev is the Brazilian beer brewer which is also owned by Anheuser-Busch InBev.
InBev was an independent company that was created as a result of the 2004 merger between Brazil-based Ambev and Belgian firm Interbrew.
In 2008, InBev acquired Anheuser-Busch — whose brands include Bud Light, Budweiser, Michelob, Busch, Stella Artois, and Hoegaarden, among others — in a cash deal worth $52 billion.
An HSBC analyst downgraded Anheuser-Busch InBev stock due to backlash over the partnership with Mulvaney.AFP via Getty Images
Laboy's note was written as market data shows that beer drinkers are shunning Bud Light in increasing numbers.
Nationwide retail sales of the brand were down 23.4% versus a year ago in the week of April 29 — worse than the 21.4% decline it suffered a week earlier, according to Bump Williams Consulting and NielsenIQ data.
The controversy appears to be taking its toll on other brands within the Anheuser-Busch umbrella. The company's flagship Budweiser brand took an 11.4% sales hit for the week ended April 29. Sales of Bud's Michelob Ultra brand — the third-biggest-selling in the US behind No. 1 Bud Light and No. 2 Modelo Especial — were down 4.4%, according to Bump Williams data.
"It's not just a Bud Light issue," said Bump Williams, chief executive of the consultancy.
"It's an Anheuser-Busch portfolio problem now."
Anheuser-Busch InBev shares were down by some 1.9% during Wednesday's morning session on Wall Street.
Anheuser-Busch InBev CEO Michel Doukeris has downplayed the impact of the backlash, saying Bud Light's US sales declines in the first three weeks of April represented only 1% of InBev's global volumes.
On April 1, Mulvaney posted a video of herself cracking open a Bud Light on her Instagram page.
She showed off a can with her face on it that Bud Light sent her — one of many corporate freebies she gets and shares with her millions of followers.
Anheuser-Busch InBev shares temporarily plunged.
Within weeks, two marketing executives at the company took a leave of absence.
I have to wonder if the powers pushing the 'trans agenda' and all the other culturally destructive shite, will 'invest' in InBev and Busch to make up the shortfall?