Constellation Brands Inc.
) soared to a new 52-week high of $54.20 on Tuesday, May 28. This
alcoholic beverage company eventually closed at $53.47, up 0.89%
from the previous day's session and generated a year-to-date
return of approximately 42.4%. This Zacks Rank #2 (Buy) company
currently trades at a forward P/E of 18.7x, a 6.3% discount to
the peer group average of 17.6x.
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A record of beating quarterly earnings expectations, sustained
focus on brand building and initiatives to introduce new products
in its wine and spirits business, are the major forces that drove
the company's shares to a new high. The average volume of shares
traded over the last 3 months is approximately 2,397K.
The recent fourth-quarter fiscal 2013 results have added to its
upbeat performance. Constellation Brands posted adjusted earnings
of 47 cents per share, surpassing the Zacks Consensus Estimate by
a couple of cents. In the last 4 quarters, the company beat the
Zacks Consensus Estimates by an average of 13.3%.
Net sales in the quarter increased 11% to $695.9 million from the
year-ago quarter and surpassed the Zacks Consensus Estimate of
$667.0 million. Net sales gained on the back of higher volumes
and better product mix in the wine and spirits business, coupled
with benefits from the Mark West acquisition.
Bolstered by a better-than-expected quarterly performance, the
company expects its fiscal 2014 adjusted earnings in the range of
$2.55-2.85 per share compared with $2.19 per share reported in
Further, we believe that Constellation Brands with its formidable
portfolio of well-known brands, new product offerings and
strategic initiatives to strengthen its foothold in the U.S.,
holds a promising future. Moreover, the company is enhancing its
points of distribution in retail and is well executing its
strategic merchandising initiatives, which will bolster sales.
Simultaneously, companies such as
Whole Foods Market Inc.
Tiffany & Co.
) achieved new 52-week highs of $107.20, $81.25 and $15.30,
respectively, on Tuesday, May 28.