Installing beadboard on studs?

We are looking to do a cheap basement remodel. We purchased a house that has a partially finished basement. Basically it has dry wall on the upper part of the wall and 1980's stucco on the lower part of the wall (below the frost line). We want to install beadboard and were wondering if we have to put up drywall on the bottom half of our basement wall and then cover it with beadboard? Or can beadboard be put directly over the wall studs?