Why Constellation Brands Is A Must-Add To Your Portfolio
Zacks Investment Research | Oct 16, 2016 09:05PM ET
You must grab the opportunity to add Constellation Brands Inc. (NYSE:STZ) to your portfolio as the stock seems to be on a roll. Armed with a formidable portfolio of well-known brands, it is the largest wine company in the world. Also, it has a dominant position in the premium wine and beer segment in the U.S. Notably, this Zacks Rank #2 (Buy) stock has jumped over 25% in the past one year. Further, it has a long-term expected earnings growth rate of 17.8%. Let’s delve deeper to know more about the stock.
What’s Leading to the Bullish Run for the Stock?
Constellation Brands’ consistent focus on brand building and its initiatives to include new products in its wine and spirits business are the key revenue drivers for the stock. Recently, the company acquired High West Distillery, which boasts a robust portfolio of unique, award-winning premium American straight whiskeys and other spirits brands.
Alongside, the company is making meaningful leadership changes in an attempt to bring about innovations and improve its operational activities. Also, it is focused on enhancing points of distribution at retail and effectively executing its strategic merchandising initiatives to boost sales.
Moreover, Constellation Brands is on track with its glass plant expansion, which is expected to cater to more than 50% of the glass demand. Further, in an attempt to create value for its shareholders and strengthen the financial position of its Wine and Spirits business, the company is assessing the advantages of executing an initial public offer for a certain portion of its Canadian wine business. Also, it is a leading producer of wine in Canada and New Zealand.
Impressive Q2 Performance
Constellation Brands posted stellar second-quarter fiscal 2017 results, wherein both earnings and sales saw double-digit year-over-year growth, alongside exceeding expectations. This marked the company’s eighth and sixth consecutive earnings and sales beat, respectively. (Read: Zacks Investment Research
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