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There aren't many successful companies trading near 52-week lows right now, but Boston Beer (NYSE: SAM) is a notable exception. The alcoholic beverage specialist is down 7% in the past full year compared to a 31% gain in the S&P 500.

The slump is at least partly tied to Boston Beer's operating results. Demand dropped for its products in 2023, just as it has for most competitors across the consumer beverage industry. Yet Boston Beer also had some good news to report in its last quarterly earnings update. Let's look at whether the stock could make an attractive purchase for patient investors from here.

Feeling depleted

Sales were down a discouraging 12% in the most recent quarter, management revealed in a late-February press release. But things aren't nearly as bad as they might initially seem. Boston Beer's depletions, a measure of core consumer demand, declined just 1%. Shipments to its retailing partners were similarly steady, down only 4%.

These trends represented improvements compared to the prior quarter and kept Boston Beer ahead of key rivals. Anheuser-Busch InBev (NYSE: BUD), for example, recently announced a 12% shipment decline as demand fell hard for its Bud Light brand.

Yet both companies said they're seeing an industry rebound take shape over the past several months. "We were pleased to deliver steady improvement in ... depletions, solid progress on gross margin expansion and strong cash flow generation," Boston Beer Chairman Jim Koch said in a press release.

The financial wins

Boston Beer is getting financially stronger, despite the poor sales trends that pressured the business in the past year. That's great news for investors because it implies a big earnings rebound ahead once the industry starts growing again.

Gross profit margin rose to 38% of sales from 37% of sales last quarter, thanks to cost cuts and price increases. The company was able to mostly offset falling demand for its Truly Hard Seltzer brand, which has slumped in the wake of a huge demand spike during the pandemic.

Boston Beer hasn't found a way to replace that absence in its portfolio, but depletions are rising in brands like Twisted Tea and Dogfish. In other words, the company's innovation platform is working well, even though its product launches are entering a sluggish industry at the moment.

Prepare for volatility

The biggest questions going forward surround the timing and scale of Boston Beer's next growth cycle. Most Wall Street pros are looking for sales to rise by just 2% in 2024 and by less than 4% next year. Those projections reflect some pessimistic assumptions about the business and the beer industry, and Boston Beer may outperform them, potentially with help from a steady stream of new beverage launches in hit brands like Twisted Tea.

On the other hand, the stock could underperform again this year if the brewer can't return to steady growth in depletions. Price increases won't provide the same lift they did to sales in 2023, after all, due to slowing inflation.

As you might expect, Boston Beer stock trades at a discount that reflects this uncertainty. You can own shares for 1.8 times sales today, down from a price-to-sales ratio of 2.3 within the past year. InBev is a bit more expensive on that basis despite its weaker growth performance.

Patient investors, then, will likely see good returns from holding Boston Beer over the next several years. Brace for volatility, though, and potentially weak returns in 2024, as the beverage giant lays the groundwork for its next bubbly growth phase.

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Demitri Kalogeropoulos has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Boston Beer. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.