How Has Constellation Brands’ Stock Performed in 2016?



Movement so far

Constellation Brands’ (STZ) stock price has risen 17.7% to $165.58 as of September 26 on a YTD (year-to-date) basis. Currently, the company is trading above its YTD average price of $155.31. On a YTD basis, Constellation Brands outperformed the S&P 500 Index, which was up 6.6% as of September 26.

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Outperformed its peers

Constellation Brands’ stock has outperformed 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 moved 7.9%, 13%, and -3.4% on a YTD basis.

Investors can gain exposure to Constellation Brands through the Consumer Staples Select Sector SPDR Fund (XLP). XLP invests 2.4% of its holdings in Constellation Brands. As of September 26, XLP rose 6.1% on a YTD basis.

Growth strategy

Constellation Brands is focusing on expanding its presence in the premium end of the beer, wine, and spirits market. The acquisition of Meiomi and Prisoner wine brands was part of this strategy. The company is also investing in the expansion of its beer production capacity to support the strong demand for its Mexican beer portfolio. We discussed the expansion of the company’s Nava brewery facility in Part 2 of this series. Constellation Brands is also looking for growth in the craft beer space. The company acquired Ballast Point in late 2015 for about $1 billion to facilitate its growth in the craft beer category.

We’ll discuss analysts’ recommendations for Constellation Brands in the next part of this series.


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