Equity prospects


Michael Bray, Research Analyst


52 week high-low£27.15—£8.90

Net yield0.73%

Hist / pros per41.03—50.79

Equity market cap£2,400

The weather is getting nicer and although we can’t enjoy pub gardens (yet), I am still craving a good G&T. Enter FeverTree, the pioneer and market leader in the global premium tonic and drink mixer market. 

FeverTree has seen a remarkable rise in its 15 years of existence. Its premium products have been able to piggyback off the growth in artisanal gin consumption and they have been able to achieve consumer ‘front of mind’ status through superb marketing, after all “if ¾ of your drink is the mixer, make sure you use the best”. 

FeverTree now generates £261M of revenue and is worth an estimated £2B. Business has however slowed markedly; revenue growth dropped from 39.5% in FY18 to 9.7% in FY20, as a result of slowing tonic sales growth in the UK (~43% of group revenue). Although the UK tonic market is maturing, demand for it is unlikely to abate.

For growth to reaccelerate, FeverTree will need to look to international markets. The US remains a big prize for the business but growth is unlikely to come from tonic mixers: Americans prefer ginger ale/beer and soda mixers with their spirits of choice - Rum, Tequila, Vodka and Whiskey. Whether FeverTree can truly crack the States is yet to be seen.

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