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Summary of article from Barron's Weekly Magazine. Receive all our Barron's summaries by signing up here:

They Know Jack by Andrew Bary

Summary: Brown-Forman (NYSE:BF.B) distillers has built a strong domestic and overseas market for its Jack Daniel's whiskey, Southern Comfort, Finlandia vodka and Korbel champagne. With heavy advertising and premium pricing (about $20 for a 3/4 liter bottle), 8.5 million cases of top-seller Jack Daniel's were sold in 2005. The #6 liquor brand in the world, 9 million cases are expected to sell in 2007, about half overseas. Yet investors sold down BF.B's Class B-shares from $82 last March to $66 because of a slight earnings miss in October of $0.92/share, $0.04 below expectations but 7% higher than Oct. 2005, and for its expensive $776 million purchase of Mexican Tequila maker Grupo Industrial Herradura. Investors worried about slowing growth are overlooking 1) BF.B's consistent earnings growth record, and double digit projections. 2) A growing worldwide consumer penchant for liquor over beer. 3) U.S. easing of bourbon advertising restrictions. 4) Iconic celebrity cache. 5) Class B shares at 21 P/E or $3.10/share for fiscal 2007, on par with main competitors like Britain's Diageo and France's Pernod Ricard. 6) Brown-Forman is a possible takeover or merger target at $8 billion, despite the controlling Brown family's pronouncements that they're not interested. Barron's Bottom Line: Bulls say the stock could reach $80 in 12 months as Jack Daniel's worldwide popularity grows.

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Brown-Forman Investment

Source: Brown-Forman Should Keep Investors in Good Spirits - Barron's