UBS Maintains a 'Buy' on Constellation Brands (STZ); Underappreciated Earnings Power

UBS maintains a 'Buy' on Constellation Brands (NYSE: STZ) price target of $40.00 (from $35.00).

Analyst, Kaumil S. Gajrawala, said, "While STZ shares immediately reacted favorably to news of the acquisition, we see significant further upside vs. current levels. In this note, we examine the three aspects of STZ’s business, and raise our FY14e EPS to $2.90 from $2.38 and FY15e to $3.24 from $2.67 (calendar 2013, 2014). Our estimates assume deal closure on 2/28/13. Today, STZ shares are trading at ~10.5x our CY2013e EPS." (FY14 EPS estimate raised from $2.38 to $2.90)

For an analyst ratings summary and ratings history on Constellation Brands click here. For more ratings news on Constellation Brands click here.

Shares of Constellation Brands closed at $29.06 yesterday.

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