On Jul 10, 2014, we issued an updated research report on
Constellation Brands, Inc.
) following the company's splendid first-quarter fiscal 2015
results and upbeat guidance for the fiscal.
We are optimistic about this alcoholic beverage company after it
posted outstanding first-quarter results on Jul 2, wherein earnings
jumped nearly threefold to $1.07 per share from 38 cents posted in
the comparable year-ago quarter mainly driven by the acquisition of
Crown Imports business last year. Moreover, quarterly earnings
surpassed the Zacks Consensus Estimate of 92 cents per share.
Net sales more than doubled from $673.4 million in the first
quarter of fiscal 2014 to $1,526.0 million in the reported quarter.
Moreover, the company's top-line was also above the Zacks Consensus
Estimate of $1,478.0 million. The year-over-year increase in top
line was primarily attributable to complete consolidation of the
Crown Import business as well as strong demand for beer.
Following its strong start of the fiscal, the company raised its
forecasts for fiscal 2015. Constellation Brands now expects fiscal
2015 adjusted earnings to be in the range of $4.10-$4.25 per share,
up from previous guidance range of $3.95-$4.15 per share and
compared with $3.25 earned in fiscal 2014. On a reported basis,
earnings per share in fiscal 2015 are now anticipated to be in the
range of $3.90-$4.05 as against $3.75-$3.95 projected earlier and
$9.83 reported in fiscal 2014.
As the largest wine company in the world, Constellation Brands
has a formidable portfolio of well-known brands. The company's
consistent focus on brand building and its initiatives to include
new products in its wine and spirits business are key revenue
drivers for the stock.
Owing to its strategic endeavors, it is witnessing robust
depletion trends and increasing market share in the U.S. wine and
spirits category. Moreover, the company is increasing its
distribution points in retail and effectively executing its
strategic merchandising initiatives, aimed at bolstering sales.
Other Stocks to Consider
Other well performing stocks in the Beverages-Alcohol space
Castle Brands Inc.
Boston Beer Inc.
), both sporting a Zacks Rank #1 (Strong Buy) along with
) carrying a Zacks Rank #2 (Buy).
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