Constellation Brands tops analysts’ estimates for earnings and revenue in Q3

By: Wajeeh Khan
Wajeeh Khan
Wajeeh is an active follower of world affairs, technology, an avid reader, and loves to play table tennis in… read more.
on Jan 7, 2021
  • Constellation Brands tops analysts’ estimates for earnings and revenue in the third quarter.
  • The U.S. firm's board approved a new share repurchase programme valued at £1.48 billion.
  • Constellation closed its deal to sell a part of its wine & spirits portfolio to E. & J. Gallo Winery.

Constellation Brands Inc. (NYSE: STZ) said that it blew past Wall Street estimates in the fiscal third quarter on Thursday. The company reported £950 million of net income in the quarter that concluded on 30th November that translates to £4.84 per share. In comparison, its net income was capped at a sharply lower £266.10 million in the same quarter last year or £1.37 per share.

Constellation Brands closed its deal to sell a part of its wine and spirits portfolio to E. & J. Gallo Winery on Thursday. The deal had an aggregate value of £598 million.

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Constellation Brands opened about 4% up on Thursday and jumped another 2% in the next hour. The stock is now exchanging hands at a per-share price of £169.69. In comparison, the U.S. company was trading at a sharply lower £78 per share in March when the COVID-19 crisis pushed the countrywide pubs and bars into temporarily shutting down.

Constellation Brands Q3 financial results versus analysts estimates

On an adjusted basis, Constellation Brands earned £2.28 per share in Q3. The Fortune 500 company said it generated £1.80 billion of sales in the recent quarter versus the year-ago figure of a lower £1.48 billion.

According to FactSet, experts had forecast the American producer and marketer of beer, wine, and spirits to register £1.65 billion of sales in the third quarter. Their estimate for adjusted earnings per share was capped at £1.79. CEO Bill Newlands expressed confidence on Thursday that the company’s performance was remarkable considering the challenging atmosphere attributed to the ongoing COVID- crisis.

The novel flu-like virus has so far infected more than 21 million people in the United States and caused over 370 thousand deaths. In separate news from the United States, packaged foods company, Conagra Brands said that its net income jumped to £280 million in the fiscal second quarter.

Constellation Brands’ forecast for the full financial year

For the full financial year, Constellation Brands now forecasts its adjusted per-share earnings to fall in the range of £7.24 to £7.42. The Victor-based company’s board approved a new share repurchase programme valued at £1.48 billion on Thursday.

Constellation Brands performed fairly upbeat in the stock market last year with an annual gain of more than 15%. At the time of writing, the largest beer import company in the U.S. is valued at £32.75 billion and has a price to earnings ratio of 43.06.

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