Constellation Brands Beats Earnings Targets on Huge U.S. Beer Sales

Shares of adult-beverage distiller Constellation Brands surged more than 12% higher overnight on a fantastic third-quarter report.

Jan 8, 2014 at 10:58AM

Constellation Brands (NYSE:STZ) reported third-quarter results this morning, beating Wall Street's earnings estimates by a large margin. The stock jumped as much as 12.1% overnight on the news.

The company saw very strong beer sales in America this summer, particularly in Mexican brands such as Modelo Especial and Corona. The trend continued into the fall and holiday seasons, pushing Constellation's sales 88% higher year over year.

The $1.44 billion top-line revenue was stronger than the $1.4 billion predicted by analysts. Earnings surged 75% higher year over year on a constant currency basis, landing at $1.10 per share. Analyst estimates would have settled for $0.91 per share.

Constellation's sky-high growth includes the impact of a complex $4.8 billion deal that added several of Grupo Modelo's brands to Constellation along with a brewery facility in Mexico. A part of Anheuser Busch InBev's Modelo buyout, AB InBev sold these assets to Constellation in order to secure regulatory approval.

Constellation CFO Bob Ryder noted that free cash flows surged 61% year over year, and he promised to invest the cash profits into future growth: "We expect brewery capital expansion investments to significantly increase in the fourth quarter of this fiscal year."


Fool contributor Anders Bylund has no position in any stocks mentioned. Follow him on Twitter @TMFZahrim. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days.

We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

©1995-2014 The Motley Fool. All rights reserved. | Privacy/Legal Information