Canaccord Genuity on Constellation Brands (STZ): Written In The Stars
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Price: $262.39 +1.43%
Rating Summary:
27 Buy, 10 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 11 | Down: 18 | New: 17
Rating Summary:
27 Buy, 10 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 11 | Down: 18 | New: 17
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Canaccord Genuity on Constellation Brands (NYSE: STZ): Written in the stars.
Canaccord analyst says, "Shares of Constellation Brands, the world’s largest winemaker, were on the rise after the company reported a solid earnings beat on the back of strong North American sales and forecast F12 earnings ahead of analyst estimates. The company’s Q4 earnings came in at $0.35 per share on sales of $715.3 million, beating the consensus estimate of $0.27 as sales in North America increased by 14%. For the coming year, it forecast earnings of $1.90 to $2.00 per share, while Wall Street expected $1.89. Credit Suisse notes that on top of strong North American sales, Constellation’s partnership with Crown Imports and a lower-than-expected tax rate (31% versus 38%) helped drive results. The brokerage notes that the smaller brands in the Crown portfolio are starting to achieve important scale and moving the aggregate growth rates of Crown. Other brands in the portfolio are adding growth to the mature Corona base volume, which the brokerage says is in sharp contrast to their closest import competitor which is seeing slower growth rates. They believe the difficult period of the Crown business model transition and the portfolio transition from a maturing Corona Extra to other engines of growth such as Modelo Epecial, Corona Light and Victoria is in the past. The company is looking to boost the top and bottom line in the coming quarter according to CEO Rob Sands as it will make “selected price increases on certain specialty and value products” in an attempt to boost margins. The company acknowledges that consumers are still price sensitive, and assured analysts and investors that pricing would not get “out of whack” with its competitors."
Canaccord analyst says, "Shares of Constellation Brands, the world’s largest winemaker, were on the rise after the company reported a solid earnings beat on the back of strong North American sales and forecast F12 earnings ahead of analyst estimates. The company’s Q4 earnings came in at $0.35 per share on sales of $715.3 million, beating the consensus estimate of $0.27 as sales in North America increased by 14%. For the coming year, it forecast earnings of $1.90 to $2.00 per share, while Wall Street expected $1.89. Credit Suisse notes that on top of strong North American sales, Constellation’s partnership with Crown Imports and a lower-than-expected tax rate (31% versus 38%) helped drive results. The brokerage notes that the smaller brands in the Crown portfolio are starting to achieve important scale and moving the aggregate growth rates of Crown. Other brands in the portfolio are adding growth to the mature Corona base volume, which the brokerage says is in sharp contrast to their closest import competitor which is seeing slower growth rates. They believe the difficult period of the Crown business model transition and the portfolio transition from a maturing Corona Extra to other engines of growth such as Modelo Epecial, Corona Light and Victoria is in the past. The company is looking to boost the top and bottom line in the coming quarter according to CEO Rob Sands as it will make “selected price increases on certain specialty and value products” in an attempt to boost margins. The company acknowledges that consumers are still price sensitive, and assured analysts and investors that pricing would not get “out of whack” with its competitors."
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