Constellation Brands Stock Rose on Strong 1Q Earnings
Constellation Brands’ (STZ) stock rose 5.0% on June 29 in reaction to the company’s strong earnings for fiscal 1Q18, which ended on May 31, 2017. The company exceeded the consensus analysts’ earnings estimate but fell slightly short of sales estimates. The beer, wine, and spirits maker’s stock is up by an impressive 25.8% on a YTD (year-to-date) basis.
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Comparison with peers
As of June 29, Constellation Brands stock has outperformed other major alcoholic beverage stocks on a YTD basis. The stock prices of Anheuser-Busch InBev (BUD), Molson Coors Brewing (TAP), and Brown-Forman (BF.B) have risen 5.0%, -11.1%, and 8.5%, respectively, on a YTD basis.
Constellation Brands stock has also outperformed the S&P 500 Index, which has moved up 8.1% since the start of the year.
Constellation Brands has been delivering a strong performance in the recent quarters driven by the continued demand for its Mexican beer brands. The company is also gaining from its strategy to focus on premium, higher-margin beer, wine, and spirits brands. As part of its “premiumization” strategy, the company has acquired several high-end brands including the Prisoner wine brands and Meiomi brands. On June 16, the company announced the acquisition of Schrader Cellars’ fine wine portfolio.
In this series on Constellation Brands’ fiscal 1Q18 results, we’ll discuss the factors that drove the company’s earnings and sales. We’ll also discuss the company’s segment performance and margins.
We’ll start with a discussion on the company’s earnings in the next part of this series.