Corona, Modelo beers drive Constellation beat, wines leave a stain

Bottles of Constellation Brands Inc. Corona beer sit on display for sale inside a Bev Mo Holdings LLC store in Walnut Creek California U.S. on Wednesday Jan. 3 2018. Constellation Brands Inc. is scheduled to release earnings figures on January 5

Bottles of Constellation Brands Inc. Corona beer sit on display for sale inside a Bev Mo Holdings LLC store in Walnut Creek California U.S. on Wednesday Jan. 3 2018. Constellation Brands Inc. is scheduled to release earnings figures on January 5

The beer company said that it had $1.84 in earnings per share (EPS) and $1.97 billion in revenue, which compares with consensus estimates of EPS of $1.72 on $1.73 billion in revenue, as well as the $1.90 per share and $1.77 billion posted in the same period of past year. The company has a market capitalization of $33.55 billion, a price-to-earnings ratio of 21.96, a price-to-earnings-growth ratio of 2.11 and a beta of 0.45.

A Fortune 500 company, Constellation Brands is the largest beer import company in the world in terms of sales.

During a conference call, CEO Bill Newlands highlighted the performance of Modelo Especial, which he described as "the leading growth engine in the entire U.S. beer market". UBS Group assumed coverage on shares of Constellation Brands in a report on Thursday, December 13th.

Constellation Brands (NYSE:STZ) said on Wednesday it would sell about 30 of its low-end wine and spirits brands to E. & J. Gallo Winery for $1.7 billion, as the Corona beer maker focuses on more profitable brands. These include Clos du Bois, Ravenswood and Mark West and the related facilities. Management previously expressed that wine sales were struggling, while the beer business continues to show strength.

Netanyahu pledges to annex West Bank settlements after vote
He went on to say that " each settlement is Israeli and [he] will not hand it over to Palestinian sovereignty ". The Palestinians want to establish a state in the occupied West Bank, east Jerusalem and the Gaza Strip.

"During fiscal 2019, our beer business delivered industry-leading double-digit sales and operating income growth led by our powerful, high-end brands and successful consumer-led innovation".

Constellation's wine and spirits portfolio was roughly flat over the 12-month period, with net sales down 0.2% to $2.9 billion and operating income falling 2.9% to $771 million. "Overall, we're confident in our ability to drive top-line growth of mid-to-high single digits over the next three to five years across our entire business".

That trend is one of the reasons that Constellation is selling some of the lower priced wine and spirits brands to Gallo, and focusing instead on the premium category. The company expects to cut between $35 million to $55 million in costs in fiscal 2020 and $75 million to $95 million in costs for fiscal 2021.

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