NYSE:STZ

Stock Analysis Report

Executive Summary

Constellation Brands, Inc., together with its subsidiaries, produces, imports, and markets beer, wine, and spirits in the United States, Canada, Mexico, New Zealand, and Italy.

Snowflake

Fundamentals

Fair value with moderate growth potential.


Similar Companies

Share Price & News

How has Constellation Brands's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

2.0%

STZ

0.8%

US Beverage

0.5%

US Market


1 Year Return

-11.6%

STZ

15.3%

US Beverage

6.8%

US Market

Return vs Industry: STZ underperformed the US Beverage industry which returned 15.3% over the past year.

Return vs Market: STZ underperformed the US Market which returned 6.8% over the past year.


Shareholder returns

STZIndustryMarket
7 Day2.0%0.8%0.5%
30 Day-3.9%0.5%-0.8%
90 Day-2.1%3.8%-0.9%
1 Year-10.3%-11.6%18.4%15.3%9.2%6.8%
3 Year22.2%17.7%34.0%23.6%45.6%36.2%
5 Year135.2%123.2%58.7%38.7%63.2%45.4%

Price Volatility Vs. Market

How volatile is Constellation Brands's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Constellation Brands undervalued compared to its fair value and its price relative to the market?

27.9%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: STZ ($197.02) is trading below our estimate of fair value ($273.16)

Significantly Below Fair Value: STZ is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: STZ is poor value based on its PE Ratio (48.7x) compared to the Beverage industry average (29.2x).

PE vs Market: STZ is poor value based on its PE Ratio (48.7x) compared to the US market (17.7x).


Price to Earnings Growth Ratio

PEG Ratio: STZ is good value based on its PEG Ratio (0.7x)


Price to Book Ratio

PB vs Industry: STZ is good value based on its PB Ratio (3.3x) compared to the US Beverage industry average (4.8x).


Next Steps

Future Growth

How is Constellation Brands forecast to perform in the next 1 to 3 years based on estimates from 19 analysts?

68.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: STZ's forecast earnings growth (68.8% per year) is above the savings rate (2.7%).

Earnings vs Market: STZ's earnings (68.8% per year) are forecast to grow faster than the US market (14.6% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: STZ's revenue (1.8% per year) is forecast to grow slower than the US market (7.2% per year).

High Growth Revenue: STZ's revenue (1.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: STZ's Return on Equity is forecast to be low in 3 years time (15.9%).


Next Steps

Past Performance

How has Constellation Brands performed over the past 5 years?

25.8%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: STZ's earnings have grown significantly by 25.8% per year over the past 5 years.

Accelerating Growth: STZ's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: STZ had negative earnings growth (-76.6%) over the past year, making it difficult to compare to the Beverage industry average (-1.9%).


Return on Equity

High ROE: STZ's Return on Equity (6.9%) is considered low.


Return on Assets

ROA vs Industry: STZ's Return on Assets is below or equal to the Beverage industry average last year.


Return on Capital Employed

ROCE Improving: STZ's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Constellation Brands's financial position?


Financial Position Analysis

Short Term Liabilities: STZ's short term assets ($3.5B) exceeds its short term liabilities ($2.2B)

Long Term Liabilities: STZ's short term assets (3.5B) do not cover its long term liabilities (13.7B)


Debt to Equity History and Analysis

Debt Level: STZ's debt to equity ratio (110.5%) is considered high

Reducing Debt: STZ's debt to equity ratio has reduced from 131.2% to 110.5% over the past 5 years.

Debt Coverage: STZ's debt is not well covered by operating cash flow (18%).

Interest Coverage: STZ's interest payments on its debt are well covered by EBIT (6.3x coverage).


Balance Sheet

Inventory Level: STZ has a high level of physical assets or inventory.

Debt Coverage by Assets: STZ's debt is not covered by short term assets (assets are 0.3x debt).


Next Steps

Dividend

What is Constellation Brands's current dividend yield, its reliability and sustainability?

1.52%

Current Dividend Yield


Upcoming Dividend Payment

Purchase Constellation Brands before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield vs Market

company1.5%marketbottom25%1.4%markettop25%3.7%industryaverage2.7%forecastin3Years1.6%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: STZ's dividend (1.52%) is higher than the bottom 25% of dividend payers in the US market (1.45%).

High Dividend: STZ's dividend (1.52%) is low compared to the top 25% of dividend payers in the US market (3.73%).

Stable Dividend: Whilst dividend payments have been stable, STZ has been paying a dividend for less than 10 years.

Growing Dividend: STZ's dividend payments have increased, but the company has only paid a dividend for 5 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (73.7%), STZ's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: STZ's dividends in 3 years are forecast to be well covered by earnings (31.8% payout ratio).


Next Steps

Management

What is the CEO of Constellation Brands's salary, the management and board of directors tenure and is there insider trading?

2.8yrs

Average management tenure


CEO

Bill Newlands (60yo)

0.6yrs

Tenure

US$7,854,942

Compensation

Mr. William A. Newlands, also known as Bill, has been the President of Constellation Brands, Inc. since February 12, 2018 and has been its Chief Executive Officer and Director since March 1, 2019. Mr. Newl ...


CEO Compensation Analysis

Compensation vs. Market: Bill has recently become CEO, making it difficult to compare their total compensation against companies of similar size in the US market.

Compensation vs Earnings: Bill's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Management Age and Tenure

2.8yrs

Average Tenure

56yo

Average Age

Experienced Management: STZ's management team is considered experienced (2.8 years average tenure).


Board Age and Tenure

2.3yrs

Average Tenure

60yo

Average Age

Experienced Board: STZ's board of directors are not considered experienced ( 2.3 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellUS$832,35230 May 19
James Sabia
EntityIndividual
Shares4,275
Max PriceUS$194.70
SellUS$167,60517 May 19
James Sabia
EntityIndividual
Shares850
Max PriceUS$197.18
SellUS$583,74308 Apr 19
Thomas Kane
EntityIndividual
Shares3,071
Max PriceUS$190.08
SellUS$262,07619 Feb 19
Barry Fromberg
EntityIndividual
Shares1,500
Max PriceUS$174.72

Ownership Breakdown


Management Team

  • Richard Sands (68yo)

    Executive Vice Chairman of the Board

    • Tenure: 0.6yrs
    • Compensation: US$7.98m
  • Rob Sands (60yo)

    Executive Chairman

    • Tenure: 0.6yrs
    • Compensation: US$10.31m
  • Francis Hetterich (56yo)

    Executive VP & President of Beer Division

    • Tenure: 16.3yrs
    • Compensation: US$5.48m
  • Bill Newlands (60yo)

    President

    • Tenure: 0.6yrs
    • Compensation: US$7.85m
  • Chris Stenzel (51yo)

    President of Wine & Spirits Division

    • Tenure: 2.8yrs
    • Compensation: US$6.02m
  • Robert Hanson (56yo)

    Executive VP and President of Wine & Spirits

    • Tenure: 0.3yrs
    • Compensation: US$396.83k
  • David Klein (55yo)

    Executive VP & CFO

    • Tenure: 4.3yrs
    • Compensation: US$7.02m
  • James Bourdeau (54yo)

    Executive VP

    • Tenure: 5.1yrs
  • Patty Yahn-Urlaub

    Vice President of Investor Relations

    • Tenure: 12.5yrs
  • Ricardo Bartra

    Senior VP & Chief Technology Officer

    • Tenure: 1.3yrs

Board Members

  • Richard Sands (68yo)

    Executive Vice Chairman of the Board

    • Tenure: 0.6yrs
    • Compensation: US$7.98m
  • Rob Sands (60yo)

    Executive Chairman

    • Tenure: 0.6yrs
    • Compensation: US$10.31m
  • Jerry Fowden (62yo)

    Non-Executive Director

    • Tenure: 9.4yrs
    • Compensation: US$257.43k
  • James Locke (77yo)

    Lead Director

    • Tenure: 0yrs
    • Compensation: US$257.43k
  • Dan McCarthy (55yo)

    Director

    • Tenure: 4.3yrs
    • Compensation: US$242.43k
  • Bill Newlands (60yo)

    President

    • Tenure: 0.6yrs
    • Compensation: US$7.85m
  • Jennifer Daniels (55yo)

    Director

    • Tenure: 1.1yrs
    • Compensation: US$167.62k
  • Judy Schmeling (59yo)

    Director

    • Tenure: 6.7yrs
    • Compensation: US$426.89k
  • Ernesto M. Hernández (61yo)

    Director

    • Tenure: 5.3yrs
    • Compensation: US$242.43k
  • Susan Johnson (53yo)

    Director

    • Tenure: 2.3yrs
    • Compensation: US$242.43k

Company Information

Constellation Brands, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Constellation Brands, Inc.
  • Ticker: STZ
  • Exchange: NYSE
  • Founded: 1945
  • Industry: Distillers and Vintners
  • Sector: Food, Beverage & Tobacco
  • Market Cap: US$37.638b
  • Shares outstanding: 190.81m
  • Website: https://www.cbrands.com

Number of Employees


Location

  • Constellation Brands, Inc.
  • Building 100
  • 207 High Point Drive
  • Victor
  • New York
  • 14564
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
STZ.BNYSE (New York Stock Exchange)Class B Common StockUSUSDFeb 1973
STZNYSE (New York Stock Exchange)YesClass A Common StockUSUSDJul 1986
CB1ADB (Deutsche Boerse AG)YesClass A Common StockDEEURJul 1986
STZ *BMV (Bolsa Mexicana de Valores)YesClass A Common StockMXMXNJul 1986
STZSWX (SIX Swiss Exchange)YesClass A Common StockCHCHFJul 1986
STZB34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH REP 0.25 COM USD0.01 CLASS ABRBRLMay 2019

Biography

Constellation Brands, Inc., together with its subsidiaries, produces, imports, and markets beer, wine, and spirits in the United States, Canada, Mexico, New Zealand, and Italy. It provides beer primarily u ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/20 23:35
End of Day Share Price2019/10/18 00:00
Earnings2019/08/31
Annual Earnings2019/02/28


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.