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MarketScreener Homepage  >  Equities  >  Nyse  >  Constellation Brands, Inc.    STZ

CONSTELLATION BRANDS, INC.

(STZ)
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Cannabis Bet Hurts Beverage Company -- WSJ

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01/09/2020 | 02:48am EST

By Micah Maidenberg

Constellation Brands Inc. said the value of its bet on a Canadian cannabis company fell again in the latest quarter.

The owner of the Corona and Modelo beer brands on Wednesday reported a $534 million decline in the value of its investment in Canopy Growth Corp. tied to weaker share prices for that company. In all, Constellation said its exposure to Canopy sliced a quarter off profit for the company's fiscal third quarter.

Constellation, which in 2018 invested about $4 billion in Canopy, wagering on the future of cannabis-infused drinks and other products, reported a loss in its previous quarter tied to Canopy. Shares of the Canadian firm have lost almost 35% of their value over the past year.

However, the beverage company said its profit and sales gained on stronger demand for its beer. Shares of Constellation rose 4% in premarket trading.

The company reported earnings of $360.4 million for its fiscal third quarter, compared with $303.1 million a year earlier. Its adjusted profit of $2.14 a share surpassed the consensus estimate of $1.82 a share as compiled by FactSet.

Sales rose about 1% to $1.99 billion, a bit more than forecasts.

Beer sales rose 8% to $1.31 billion in the quarter compared with the previous year. Wine and spirits dropped 10% to $689 million, the company said.

Constellation has been rethinking its portfolio amid shifting consumer interest in alcoholic drinks.

The company struck a deal last month to sell its Ballast Point craft-beer brand to a Chicago-area brewer. It plans to launch an alcoholic seltzer to compete with offerings such as Mike's Hard Lemonade Co.'s White Claw.

Constellation also is working to sell a portfolio of wines to E. & J. Gallo Winery. The companies said in December they revised the deal by excluding some brands from the transaction to address concerns the Federal Trade Commission raised during a review.

Write to Micah Maidenberg at micah.maidenberg@wsj.com

Stocks mentioned in the article
ChangeLast1st jan.
AURORA CANNABIS INC. -0.90% 2.21 Delayed Quote.-20.07%
CANNTRUST HOLDINGS INC. -1.82% 1.08 Delayed Quote.-8.33%
CANOPY GROWTH CORPORATION -2.30% 28.91 Delayed Quote.8.35%
CONSTELLATION BRANDS, INC. -0.45% 207.4 Delayed Quote.9.30%
CRONOS GROUP INC. -2.88% 9.44 Delayed Quote.-2.51%
HEXO CORP. -3.14% 1.85 Delayed Quote.-7.73%
THE GREEN ORGANIC DUTCHMAN HOLDINGS LTD. -3.51% 0.55 Delayed Quote.-24.00%
THE SUPREME CANNABIS COMPANY, INC. -2.53% 0.385 Delayed Quote.-37.30%
TILRAY, INC. 0.68% 19.37 Delayed Quote.13.08%
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Financials (USD)
Sales 2020 8 263 M
EBIT 2020 2 631 M
Net income 2020 -60,7 M
Debt 2020 11 615 M
Yield 2020 1,44%
P/E ratio 2020 -481x
P/E ratio 2021 23,1x
EV / Sales2020 6,19x
EV / Sales2021 6,38x
Capitalization 39 565 M
Chart CONSTELLATION BRANDS, INC.
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Technical analysis trends CONSTELLATION BRANDS, INC.
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TrendsBullishNeutralNeutral
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 21
Average target price 225,20  $
Last Close Price 207,40  $
Spread / Highest target 28,3%
Spread / Average Target 8,58%
Spread / Lowest Target -8,87%
EPS Revisions
Managers
NameTitle
William A. Newlands President, Chief Executive Officer & Director
Robert S. Sands Executive Chairman
Garth Hankinson Chief Financial Officer & Executive Vice President
Richard E. Sands Executive Vice Chairman
James A. Locke Lead Independent Director
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1st jan.Capitalization (M$)
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CONCHA Y TORO WINERY INC--.--%1 273
DELEGAT'S GROUP LTD.--.--%679
LAURENT-PERRIER0.00%562