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Alberto Abaterusso
Alberto Abaterusso
Articles (1506) 

Constellation Brands Jumps on 4th-Quarter Results

The US global beverage company beats consensus estimates on non-GAAP earnings and revenues

April 04, 2019 | About:

Shares of Constellation Brands Inc. (NYSE:STZ) were up 0.12% to $179.90 in premarket trading on Thursday after beating consensus estimates by 12 cents with non-GAAP earnings of $1.84 per share for the final trimester of fiscal 2019. The result represented a 3.2% decline from the same quarter a year ago.

Non-GAAP earnings also soared 40% to $6.37 per share in the quarter. Revenue was $1.8 billion or 1.7% higher, beating expectations by $70 million. Revenue growth was driven by strong shipments volume of Modelo and Corona brands. The beer business segment contributed 60.6% or $1.09 billion in revenue and the wine and spirits business segment 39.4% or $707.1 million.

The U.S. global beverage alcohol company also posted results for the entire year of fiscal 2019.

Year-over-year, non-GAAP earnings increased 7% to $9.28 per share, GAAP earnings grew 53% to $17.57 per share, the operating cash flow jumped 16.3% to a record amount of $2.246 billion and the free cash flow skyrocketed 55% to $1.36 billion.

Further, during the year, the company repurchased 2.4 million of its common shares, investing $504 million.

Amid the most important projections for the full year of fiscal 2020, Constellation Brands expects non-GAAP earnings to range between $8.5 and $8.8 per share versus consensus estimates of $9.44 per share, and $1.15 billion for free cash flow.

Shares of Constellation Brands Inc. traded around $179.69 at close Wednesday for a market capitalization of $34.08 billion. The share price decreased 22% for the 52 weeks through April 3 to below the 200-day simple moving average line and above the 100- and 50-day simple moving average lines. The closing price on Wednesday was 19.5% off the 52-week low of $150.37 and 31.7% below the 52-week high of $236.62.

The 14-day Relative Strength Indicator is 65.45 suggesting the stock is neither overbought nor oversold.

According to the chart of Peter Lynch, the stock appears cheap.

Wall Street issued a buy recommendation rating on shares of Constellation Brands with an average target price of $209.88 per share within 52 weeks.

Disclosure: I have no positions in any securities mentioned.

About the author:

Alberto Abaterusso
If somebody asks what being a value investor means, Alberto Abaterusso would answer, “The value investor is not just the possessor of the security that represents the company, but he is the owner of that company. As an owner of the company the value investor is actively involved in the dynamics of that company and his first concern is how to have sales progressively growing. Also, the value investor is probably one of the most demanding persons in the world concerning sales.”

Abaterusso is a freelance writer based in The Netherlands. He primarily writes about gold, silver and precious metals mining stocks. His articles have also been widely linked by popular sites, including MarketWatch, Financial Times, 24hGold, Investopedia, Financial.org, CNBS, MSN Money, Zachs, Reuters and others. Alberto holds an MBA from Università degli Studi di Bari (Italy), Aldo Moro.

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