STZ Soars to a New High - Analyst Blog


Shares of Constellation Brands Inc. ( STZ ) 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.

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 fiscal 2013.

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. ( WFM ), Tiffany & Co. ( TIF ) and Kirkland's Inc. ( KIRK ) achieved new 52-week highs of $107.20, $81.25 and $15.30, respectively, on Tuesday, May 28.

KIRKLANDS INC (KIRK): Free Stock Analysis Report

CONSTELLATN BRD (STZ): Free Stock Analysis Report

TIFFANY & CO (TIF): Free Stock Analysis Report

WHOLE FOODS MKT (WFM): Free Stock Analysis Report

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: KIRK , STZ , TIF , WFM

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