Rally On, Traders!
It's a great time to be in the premium liquor business. For one thing, alcohol is a TRILLION-dollar market and it's going to come close to doubling between
now and the end of 2024. That's easily a compound growth rate of 18% a year if not more. Big stuff.
But the really exciting part here in the U.S. is the high end, where unit sales are growing three times as fast as the market as a whole. That's not dollar sales . . . these brands are ultra luxury, they can cost 10X a normal bottle. It's pure consumption.
Drinkers are simply shifting up market and they're willing to pay a huge surcharge when they see quality, glamour and pure peer pressure.
That's where Iconic Brands Inc. (OTC: ICNB) enters the picture. It's a little company right now, in the early stages of grabbing its piece of that trillion-dollar opportunity. That's okay. As we'll see, this is a wide open space and new breakout brands are being created all the time.
And ICNB has an inside track on success. May I introduce you to their secret weapon, CEO/CFO/Founder Richard DeCicco.
Here's his Linkedin showing 12 years running national sales for United Spirits, which following the dots leads back to beverage behemoth Diageo. There's another 7 years as president there too. Here's his Bloomberg profile. Before
that his official biography stretches back over three decades and by the time you read this it could already be up to four.
I think he knows how to build buzz around a new beverage. He's worked on Skyy, Stoli, Jagermeister, Malibu, Bailey's. Wherever he goes, sizzle happens. His game plan is right HERE.
What's he got cooked up now? Start with Bellissima Prosecco. Sparkling wine. Vegan, organic, gluten free. The kind of product that can sell 1,200 bottles a MINUTE on QVC. And it's going to be back on the channel on
January 8, which is Wednesday.
Premium spirits is all about picking the right "face," the right celebrity spokesperson to tell the story and make people feel important because they drink like the stars. Richard DeCicco reached out to someone you've probably heard of: once and future supermodel Christie Brinkley. (VIDEO)
Doesn't she look great? Don't those bottles look cool and distinctive? That's what grabbing the premium end of the drink market is all about.
But you don't want to be a one-trick rodeo. It's good to have two shots on the goal. ICNB knows vodka, so that one was easy. Vodka is cool. Sicilians have a certain aura of intrigue, mystery and especially the finer things in life. Sicily is old luxury, artisanal expertise, a wink and a nudge. It's need to know. That's BiVi. Semolina wheat base to match perfectly with pasta. A lifetime of distilling
experience. Mountain spring water, volcanic soil.
United Spirits handles the distribution. Good terms: fees are only $1 per case. ICNB rakes in the rest of the wholesale price. This is premium territory. Prices are healthy because that's what the market will bear. If people don't pay a lot for their liquor, they feel cheated.
ICNB is also supplying restaurant chains like Hooters with well liquors: tequila, gin, vodka, rum, etc. What goes well with Hooters? NASCAR. There's a cross promotional deal with NASCAR to draw eyeballs to these "private label" brands.
Bellissima is on Celebrity Cruise Lines now. Promotional events are happening all the time. There's talk about a Cheesecake Factory deal. All good things when you're
trying to make a big splash.
What's the game plan? Read between the lines and DeCicco ultimately wants to get bought out. There's no shame in that. Sammy Hagar sold his tequila for $80 million, 11.8X EBITDA. George Clooney sold his tequila for $1 billion cool and clean, 18X sales.
I see a $9 million market cap on ICNB right now. Early stages. On the Clooney scale, that only implies what, the first $500,000 in annual sales? Everything beyond that point starts moving the needle. Bellissima retails $20 a bottle. BiVi is $30. My envelope math says it doesn't even take 1,000 cases of each before shareholders start feeling pretty good.
There's 227 MILLION cases of liquor moving in and out of American stores every year according to that chart up there. ICNB is priced for 0.4% share of that market now. Anything else is pure GRAVY.
Did I mention the spokesman for the vodka? Say hello, Chazz Palminteri, one of the ultimate cool guys:
Now maybe you're a skeptic. A lot of hot shots are aiming for that 0.4% share of the market. What makes this particular sub-$1 stock so special?
DeCicco has the experience. He has the stars. He has the products. He has a PLAN. And he has the willpower to make the tough choices when necessary . . . something those punk kids just don't have.
Early last year, team-ups between liquor companies and hemp growers were red hot stuff. Billions of dollars were on the move. Every spirit company with ambition was looking for an angle on green drinks and ICNB was right there with them.
No shame in that. But the green boom fizzled. The big boys have written off HUNDREDS of millions of dollars in paper losses, enough to buy and sell little ICNB 60 times over.
What does DeCicco do? He didn't bury his head in the sand. He admitted that the green thing just isn't right for him right now. It's a distraction. So he found a buyer and unwound the deal.
No more green drinks holding ICNB back. It's no wonder the stock is back on the upswing now. And remember, this price only implies 1,000 cases a year on the Clooney scale. Christie Brinkley moves 1,000 bottles a MINUTE. I'll be watching this stock carefully. I suggest you do too.
Happy, Happy, Happy Trading!
