Constellation Brands Inc (STZ) Receives a Buy from Jefferies

By Ryan Adsit

In a report released yesterday, Kevin Grundy from Jefferies reiterated a Buy rating on Constellation Brands Inc (STZResearch Report). The company’s shares opened today at $167.35.

Grundy observed:

“STZ’s CAGNY pres. was upbeat on the runway for growth in beer (> 70% of EBIT); however, mgmt. wanted to level set expectations in key areas (beer OM %, near-term EPS dilution from wine divest./WEED). STZ’s med-term target for ~10% EPS CAGR was reiterated despite likely declines in FY20. We trim our PT to $255/concede shares likely to tread water near-term, though see beer biz as one of best in CPG and valuation as attractive at ~13.5x EV/EBITDA (ex-Canopy).”

According to, Grundy is a 4-star analyst with an average return of 5.7% and a 59.5% success rate. Grundy covers the Consumer Goods sector, focusing on stocks such as Coca-Cola European Partners plc, Interlink Electronics, Inc., and Edgewell Personal Care.

The word on The Street in general, suggests a Moderate Buy analyst consensus rating for Constellation Brands Inc with a $204.21 average price target, implying a 22.0% upside from current levels. In a report issued on February 13, Morgan Stanley also maintained a Buy rating on the stock with a $233 price target.

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Constellation Brands Inc’s market cap is currently $31.32B and has a P/E ratio of 11.67. The company has a Price to Book ratio of 2.78.

Based on the recent corporate insider activity of 44 insiders, corporate insider sentiment is negative on the stock. Earlier this month, Barry Fromberg, a Director at STZ sold 810 shares for a total of $140,171.

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Constellation Brands, Inc. engages in the production, marketing, and distribution of beer, wine, and spirits. It operates through the following segments: Beer, Wine and Spirits, and Corporate Operations and Other. The Beer segment includes imported and craft beer brands.