“We believe LQR is undervalued, and we support that belief with two valuation techniques. To determine our price target, we use a discounted future earnings model, and we support that with a comparable valuation to peers. The average of peers 2024 market cap/sales is ~2.80x and the range is 0.66x to 7.90x. The comparable metric for LQR is 1.21x, which is less than half the average of its peers. This, and our discounted future earnings model confirm our view that the shares are undervalued. Were the shares to trade to our price target, its market cap to sales metric would define the high end of its peers but it would be fewer than two standard deviations away.”
According to Market research provider Euromonitor, global retail sales of alcohol were estimated to be worth more than $1.5 trillion.
The United States, which is estimated to consume a total of approximately $283.8 billion worth of alcoholic beverages in 2023, represents one of the largest global markets for all alcoholic beverage category sales (Statista, Alcoholic Drinks – Worldwide, January 2023).
There is always a reason to enjoy spirits and the continued demand creates a supportive environment for businesses.
Given the current trends in the alcohol beverage industry, brands will require distinctive marketing strategies to distinguish themselves in an increasingly competitive market.
“We believe that LQR House continues to solidify its position as a trailblazer in the ecommerce landscape, showcasing rapid growth and innovative strategies to meet the evolving demands of consumers in the spirits and beverage industry.”
CEO Sean Dollinger
LQR House is a dynamic and forward-thinking e-commerce company that intends to become the full-service digital marketing and brand development face of the alcoholic beverage space. The company is actively creating value by acquiring, building, marketing, and distributing premium brands through its exclusive online networks.
The best way to describe LQR is that they are a one-stop shop for everything related to the booming spirits sector!
LQR House (NASDAQ: LQR) has also positioned itself as a leading provider of proprietary marketing solutions for rare and fine liquors. Brands collaborating with the company benefit from more than just visibility—they receive exclusivity.
The company is taking the outdated sales model of one of the biggest industries on this planet and giving it a fresh and updated look. There is enormous potential for LQR to become a powerhouse connecting e-commerce and digital channels to one of the oldest arenas around.
The company is reshaping the alcohol industry as a pioneering e-commerce company, taking charge of cwspirits.com for end-to-end control from inventory to sales.
Owning a premier e-commerce marketplace specializing in a diverse range of alcohol products, CWSpirits.com, LQR House is confident that its provision of marketing and brand management services to both wholly owned and third-party clients will significantly boost brand recognition. This strategic approach is expected to drive sales through the company's owned platform, CWSpirits.com.
LQR recently acquired 100% of CWSpirits.com, now the company operates one of the largest online retailers of liquor in the United States, located at www.cwspirits.com, which the company refers to as the CWS Platform.
The CWSpirits.com website gives LQR access to approximately 241,000 customers via the CWS mailing lists and recurring traffic on the CWS Platform!
Through strategic partnerships, creative branding, and digital prowess, LQR intends to be at the forefront of the wine and spirits marketing landscape, making it the go-to choice for brands seeking to thrive in a competitive industry.
This includes premium placements and services related to E-commerce, brick-and-mortar, importing, direct-to-consumer, and business-to-business.
LQR House has also established a robust network of over 550 influencers deeply entrenched in the alcohol space. These influencers, ranging from brand owners to bartenders and mixologists, play a pivotal role in creating viral content for brands utilizing LQR House's marketing services. They seamlessly guide their followers to specific product pages on CWSpirits.com, where online purchases can be made, with convenient doorstep delivery.
With a deep passion for the world of beverages, LQR House takes pride in curating marketing strategies aimed to elevate brands to new heights. Composed of a team of seasoned professionals, the company focuses on crafting marketing solutions tailored to each client's
Over the past decade, numerous platforms and communities have emerged in the e-commerce sphere. However, few can rival the reputation of CWSpirits.com.
The online liquor superstore offers a hassle-free shopping experience for a wide range of products, including gifts, wines, champagnes, spirits and ready-to-drink cocktails, thereby establishing itself as a major player in the digital liquor market.
Through its ownership of the CWS Platform, LQR holds exclusive rights to market on the CWS platform, sell marketing placements to other brands, and establish a network of social media influencers to further drive revenue.
CWSpirits.com stands as one of the leading e-commerce platforms, showcasing a curated selection of up-and-coming, well-known, premium, and rare spirits. The platform serves as a conduit for wine & spirits brands to reach consumers through convenient delivery options. It's important to note that while we do not hold licenses as suppliers, wholesalers, or retailers ourselves, the company takes pride in its ability to seamlessly connect consumers with a licensed outlet. This arrangement proves to be a mutually beneficial win for both our valued LQR House marketing clients and mainstream brands.
LQR has its own products that are driving growth.
The following two brands epitomize their non-commodity-styled approach of providing premium products that pay attention to consumer demands.
SWOL Tequila
SWOL Tequila is a limited-edition blend of Añejo Tequila made in exclusive batches of 10,000 bottles.
Soleil will offer different membership options that members can
customize based on preferences such as the types of wine they enjoy, and how frequently they drink wine. Our goal is to introduce people to interesting wines from around the world.
Vault is the exclusive membership program for CWS customers. Through the CWS Platform, users can sign up for this exclusive membership where they will have access to all products available through CWS combined with special membership benefits including: (i) 10% off all products site wide; (ii) free ground shipping (2-5 business days) on orders over $50 (limited to three shipping addresses); (iii) access to special promotional offers; and (iv) free mystery vault gifts in every shipment.
The monthly membership costs customers $19.95 and requires an initial 3-month start-up commitment. The objective is to create a loyal customer based that provide us with recurring monthly subscription revenue. Vault also provides LQR with the means to provide customers special discounts to marketing partner brands, which it makes solely available to Vault members. LQR markets this membership on the CWS Platform and are entitled to 50% of the revenue from the subscriptions.
Since its inception in January 2021, LQR has put its business model to the test and believes it is its path towards future success.
Moreover, LQR aims to derive significant revenue from the sale of alcohol that bears its SWOL trademark. The objective of these activities is to generate recurring monthly revenue through subscriptions and product placements.
LQR believes that its business model will result in multiple, highly sustainable revenue sources and an opportunity to capitalize on the growth in demand for liquor in the United States.
To date, sales of alcoholic beverages have been generated through the company’s exclusive arrangement with Country Wine & Spirits who sells these products. This includes third-party brands hiring the Company to market their alcoholic beverage products, subscriptions through its membership programs, and the product sale of tequila branded with its trademark, “SWOL,” bearing application number 2345291 and registration number 2141431.
LQR also intends to further diversify its revenue streams and anticipates that the diversity of its revenue streams will continue to grow as its internal brands gain market recognition and penetration, its marketing services abilities become well known, and its subscription services become popular.
The company has a competitive advantage against giants like Anheuser Busch (NYSE: BUD), Constellation Brands (NYSE: STZ), Molson Coors (NYSE: TAP), and others.
LQR has embraced the digital age wholeheartedly, allowing it to navigate the waters better compared to the giant ships that need time to shift their strategies.
And it goes further than just appearances. LQR is leveraging its mastery of utilizing digital technology to manage supply, sales, and distribution more efficiently in the spirits beverage market. The company believes that e-commerce is increasingly becoming a driver of demand for at-home consumption of alcoholic products.
The company is creating pathways to generate revenues that other companies can't or aren't doing. And they are making a presence in every aspect of the digital world!
The online world is massive and only getting bigger. Digital media is the future and outdated companies need to catch up. LQR is thinking strategically and is tapping into influencers, website banners, ads through email, SMS advertising, and an e-commerce platform built to handle the increased user volumes expected in the coming weeks and months.
LQR House has seen the growth of alcohol e-commerce firsthand.
The industry potential, coupled with the strategy and partnerships of this rising player could lead to tremendous shareholder value. To reiterate, Litchfield Hills Research believes LQR is undervalued and currently has a $26 price target!
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