Constellation Brands beats the Street on a beer boom
Constellation Brands, a major player in the alcoholic drinks industry, reported quarterly earnings last week that blew the Street’s expectations away. The company, which owns popular cerveza beer Corona (amongst others) said that a booming beer business helped it exceed predictions. The company also took this opportunity to praise its forward-thinking investment strategy, which it says will push even more growth in the future.
Constellation’s share price surged last week on the back of results
SOURCE: Yahoo Finance
Constellation delivered earnings and revenue that easily topped analysts’ predictions. The company said adjusted earnings per share came in at $2.87, against expectations for the quarter of $2.56. Likewise, revenue rose to $2.99 billion, against expectations of $2.25. Beer was the outperformer for the quarter, and Constellation said that the segment saw its operating margin grow by ten basis points, to 41.3%, from the previous quarter.
The company’s president and chief executive officer, Rob Sands, described Constellation’s beer segment as: “the number one share gainer in the U.S. beer industry,” and praised its “exceptional performance.”
Speaking to the results more generally, Sands added: "I am pleased that we have been able to increase our EPS guidance range for the year based on our year-to-date results and the plans we have in place for the remainder of the year. Given Constellation’s leadership position in the high-end U.S. beer market […] I believe Constellation will continue to be a multiyear double-digit EPS compounder.”
Dominion holds Constellation Brands in its Global Trends Luxury Fund.
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