After a rocky 2019, Constellation Brands (NYSE:STZ) seems to be on track to a better year. The company's stock is up by nearly 5% in mid-afternoon trading today, on the back of its latest set of quarterly results.
The alcoholic beverages maker -- also considered a marijuana stock by some due to its considerable investment in Canopy Growth (NASDAQ:CGC) -- reported its Q3 of fiscal 2019 Wednesday morning. For the period, net sales grew by 1% year-over-year to just under $2 billion.
Attributable net income rose 19% to just over $360 million ($1.85 per share), despite a writedown on the Canopy Growth stake that amounted to $0.25 per share -- higher than in previous quarters. On a per-share adjusted basis, Constellation's net profit shook out at $2.14.
Beer was the liquid that gave the company its fizz during the quarter. Net sales of its considerable lineup of brews rose by 8% to $1.3 billion. The smaller wine portfolio went in the opposite direction, falling nearly 10% to $689 million.
The company's top-line figure came in just above analyst estimates. Meanwhile, prognosticators were expecting only $1.83 in non-GAAP (adjusted) earnings.
More encouragingly, Constellation raised its earnings guidance for the entirety of fiscal 2019. The company now anticipates it will book a net profit per share between $9.45 and $9.55, well up from the previous estimate of $9.00 to $9.20. That forecast, however, excludes potential Canopy Growth writedowns.
Investors seem to be less concerned about the company's Canopy Growth investment than before, judging by the market's reaction to the Q3 results. The marijuana stock fell steeply in price last year, and the resulting writedowns negatively affected Constellation's fundamentals.