Constellation Brands Capitalizing On Interesting Trend

While the major players in the beer industry have performed quite well over the past year, one company in particular continues to stand out and impress Wall Street. New York based Constellation Brands (NYSE:STZ) shares hit an all time high after releasing excellent Q4 results this week. The company’s product mix has been performing very well and Constellation continues to make key acquisitions to continue to bolster its portfolio. Revenue came in at $1.5B a 14.1% increase Y/Y and EPS figures stood at 1.19 eclipsed analysts estimates of 1.14 per share.

Constellation has been on a roll with acquisitions, after acquiring Ballast Point Brewing Company and Meomi Wines in late 2015, companies that have been performing exceptionally well since getting scooped up by Constellation. It was just announced that Constellation has made another acquisition to its robust portfolio by adding Prisoner Wine Company.

Prisoner Wine is a luxury Napa Valley brand that holds the #1 wine in the Super Luxury Red Blend Category, where sales grew 28% in retail last year. STZ is also mulling over a potential IPO for the Canadian segment of the business. Constellation’s Mexican beer portfolio has really been performing well, particularly the flagship Corona Extra brand. Corona Extra is the #1 imported beer in the US and 5th largest beer brand after selling 117 million cases in 2015. Constellation’s massive $1.5B Nava facility in Mexicali is currently under construction to keep up with the demand that its Mexican brands are experiencing.

Ballast Point: A Bright Spot for Constellation

Leverage Equity Research first initated coverage on Constellation Brands in November with our Article Ballast Point: From IPA to IPO. Ballast Point intended to make history in the craft beer industry, by being the first craft beer company to go public with its IPO for $173M. Instead, it was Constellation Brands who made history with the largest craft beer acquisition ever buying Ballast Point for $1B. STZ is up 16% since the acquisition.