Beer may need to watch its back.

A new report from financial services firm Cowen and Company says beer sales have been dropping in markets where marijuana is now legal.

Vivien Azer, the managing director and senior research analyst at Cowen, says the beer business isn't booming in Colorado, Oregon and Washington-- all states where recreational cannabis use has been legalized.

“While (marijuana) retail sales opened up in these markets at different points of time, with all three of these states now having fully implemented a retail infrastructure, the underperformance of beer in these markets has worsened over the course of 2016,” Azer wrote in the report detailed on Brewbound.

WHY THIS BEER IS JUST FOR WOMEN

Looking into the data, Azer noted that “the magnitude of the underperformance has increased notably,” with beer volumes falling more than two percent year-to-date. Sales in the states also trail the overall U.S. beer market.

“This is perhaps not surprising,” Azer says, “given that U.S. government data for the states of CO, WA and OR all show consistent growth in cannabis incidence among 18-25 year olds coupled with declines in alcohol incidence (in terms of past month use).”

In the18-25 age range, both craft beer makers and mainstream beer producers have taken a hit.

It’s the latter group, however, which Azer said has been particularly affected.

POT LIMITS FOR COLORADO TOURISTS COULD BE ON THE WAY OUT

According to the report, beer volumes for mainstream beer producers have fallen 2.4 percent while premium domestic volumes like Coors Light have dropped by 4.4 percent.

Denver has been the hardest hit with total beer volumes in the market falling 6.4 percent over the past year while craft beer volumes have dropped 5 percent.

Azer said that imported beers appear to be “immune” from the legalization of pot, although volumes sold in the three western states are still behind the national growth rate.