Constellation Brands (NYSE:STZ) Sees Large Volume Increase on Better-Than-Expected Earnings

Constellation Brands Inc (NYSE:STZ) saw unusually-strong trading volume on Wednesday following a better than expected earnings announcement. 1,685,342 shares changed hands during mid-day trading, a decline of 25% from the previous session’s volume of 2,238,144 shares. The stock last traded at $115.6440 and had previously closed at $115.67.

The company reported $3.74 EPS for the quarter, beating analysts’ consensus estimates of $3.55 by $0.19. Constellation Brands had a net margin of 18.87% and a return on equity of 25.58%. The business had revenue of $2.63 billion during the quarter, compared to analysts’ expectations of $2.54 billion. During the same period in the prior year, the company earned $3.63 earnings per share. The firm’s revenue was up 6.1% on a year-over-year basis. Constellation Brands has set its FY 2027 guidance at 11.200-11.900 EPS.

Constellation Brands Dividend Announcement

The business also recently announced a quarterly dividend, which will be paid on Friday, November 13th. Investors of record on Friday, October 30th will be given a dividend of $1.03 per share. The ex-dividend date is Friday, October 30th. This represents a $4.12 annualized dividend and a yield of 3.5%. Constellation Brands’s payout ratio is 39.31%.

Key Constellation Brands News

Here are the key news stories impacting Constellation Brands this week:

• Positive Sentiment: Constellation Brands reported fiscal second-quarter adjusted EPS of $3.74, above the $3.55 analyst consensus, while revenue rose 6.1% year over year to $2.63 billion, exceeding expectations of $2.54 billion. Beer sales increased 5%, and wine and spirits sales rose 17%. Reuters earnings report
• Positive Sentiment: The company acquired SpikedAde for $75 million at closing, with potential contingent payments of up to $278 million, expanding its presence in the growing spirit-based ready-to-drink beverage category. SpikedAde acquisition announcement
• Positive Sentiment: STZ declared a quarterly dividend of $1.03 per share, or $4.12 annually, representing an indicated yield of roughly 3.5%. Wells Fargo also maintained an overweight rating despite cutting its price target to $140 from $170. Wells Fargo price target update

Analysts Set New Price Targets

Several research analysts have recently commented on the company. Sanford C. Bernstein decreased their price objective on Constellation Brands from $197.00 to $180.00 and set an “outperform” rating on the stock in a research note on Monday, September 28th. Piper Sandler reiterated a “neutral” rating and set a $160.00 price objective on shares of Constellation Brands in a research note on Wednesday, July 1st. UBS Group reduced their target price on shares of Constellation Brands from $168.00 to $145.00 and set a “buy” rating for the company in a report on Wednesday, September 23rd. Needham & Company LLC reaffirmed a “buy” rating and set a $185.00 price target on shares of Constellation Brands in a report on Thursday, July 2nd. Finally, Deutsche Bank Aktiengesellschaft dropped their price target on shares of Constellation Brands from $150.00 to $136.00 and set a “hold” rating for the company in a research report on Friday, September 11th. Ten equities research analysts have rated the stock with a Buy rating, nine have assigned a Hold rating and three have assigned a Sell rating to the company. According to MarketBeat.com, the company presently has a consensus rating of “Hold” and an average price target of $157.40.

Hedge Funds Weigh In On Constellation Brands

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in STZ. Moody National Bank Trust Division increased its stake in Constellation Brands by 50.7% in the 3rd quarter. Moody National Bank Trust Division now owns 7,120 shares of the company’s stock worth $805,000 after acquiring an additional 2,394 shares during the last quarter. Ables Iannone Moore & Associates Inc. grew its holdings in shares of Constellation Brands by 105.2% in the third quarter. Ables Iannone Moore & Associates Inc. now owns 16,904 shares of the company’s stock valued at $1,911,000 after purchasing an additional 8,667 shares in the last quarter. Rosenberg Matthew Hamilton increased its position in Constellation Brands by 14.1% in the third quarter. Rosenberg Matthew Hamilton now owns 1,101 shares of the company’s stock worth $124,000 after purchasing an additional 136 shares during the last quarter. Tompkins Financial Corp raised its stake in Constellation Brands by 2.6% during the third quarter. Tompkins Financial Corp now owns 3,745 shares of the company’s stock valued at $423,000 after purchasing an additional 95 shares in the last quarter. Finally, Junto Capital Management LP purchased a new stake in Constellation Brands during the second quarter valued at $21,683,000. 77.34% of the stock is owned by institutional investors.

Constellation Brands Stock Up 0.5%

The company has a debt-to-equity ratio of 1.06, a current ratio of 0.91 and a quick ratio of 0.48. The company’s 50-day simple moving average is $126.30 and its 200 day simple moving average is $138.65. The firm has a market cap of $19.84 billion, a P/E ratio of 11.04, a price-to-earnings-growth ratio of 2.25 and a beta of 1.75.

About Constellation Brands

Constellation Brands, Inc is a beverage alcohol company that develops, markets and distributes beer, wine and spirits. Its portfolio includes well-known beer brands such as Modelo Especial, Corona Extra, Corona Light and Pacifico, along with wine brands including Robert Mondavi, Kim Crawford, Meiomi, The Prisoner Wine Company and Ruffino.

The company also offers spirits through brands such as Casa Noble tequila and High West whiskey. Constellation’s products are sold through retailers, distributors, restaurants and other on-premise locations, with a primary focus on the United States.