‘Bud Light crisis’: HSBC downgrades Anheuser-Busch stock, sees ‘deeper problems’ than company admits

One of the world’s biggest financial companies is advising its clients not to purchase Anheuser-Busch stock because of the “Bud Light crisis.”

HSBC stock analyst Carlos Laboy downgraded stock in AB InBev, Anheuser-Busch’s parent company, to “hold,” saying the U.S. branch of the world beer giant had been damaged by the flap over its partnership with transgender social-media influencer Dylan Mulvaney.

“Is ABI’s leadership getting the brand culture transformation right? It’s mixed,” Mr. Laboy wrote in a Wednesday note. “At Ambev, we think the answer is ‘yes;’ in the U.S., we think it’s ‘no.’”

The stock analyst told HSBC customers that “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.”

Beer Marketer’s Insights has shown a steep drop in Bud Light sales — perhaps over 25%, depending on the precise measurement — in the several weeks since Bud Light’s partnership with Ms. Mulvaney.

Since then, Bud Light has been hit with boycotts and numerous public demonstrations of contempt such as Kid Rock shooting up several cases and making a video of that.

“Why did its U.S. leadership underestimate the risk of pushback given the recent experience of other firms? Is A-B hiring the best people to grow the brands and gauge risk?” Mr. Laboy wrote. “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?”

AB InBev shares were down 1.3% in Wednesday premarket trading, CNBC reported.

Ms. Mulvaney is a biological male who identifies as female and who in March marked 365 days “of being a girl” to the cheers of many of corporate America’s biggest brands, including Bud Light.

Bud Light sent Ms. Mulvaney a custom beer can featuring the face of the TikTok star who also made several videos promoting Bud Light.

The company also initially stood by the Mulvaney campaign as the social-media backlash was just starting to swell.

“Anheuser-Busch works with hundreds of influencers across our brands as one of many ways to authentically connect with audiences across various demographics and passion points,” a company spokesperson told Fox News.

It also defended sending the can as a celebration of Ms. Mulvaney’s gender transition.

“This commemorative can was a gift to celebrate a personal milestone,” the company added.

Anheuser-Busch has since lost $6 billion in stock-market value and become the target of boycotts and demonstrative attacks that have reduced Bud Light sales by about a quarter.

Multiple marketing executives have since taken a leave of absence, one of whom doing so after a video surfaced of her saying the brand’s survival required reaching out to social-media influencers and ending its “fratty” image.