Investors Buy Shares of Constellation Brands (STZ) on Weakness After Analyst Downgrade

Traders bought shares of Constellation Brands, Inc. (NYSE:STZ) on weakness during trading on Friday after Morgan Stanley lowered their price target on the stock from $246.00 to $207.00. $210.12 million flowed into the stock on the tick-up and $117.94 million flowed out of the stock on the tick-down, for a money net flow of $92.18 million into the stock. Of all equities tracked, Constellation Brands had the 10th highest net in-flow for the day. Constellation Brands traded down ($0.72) for the day and closed at $159.21

A number of other analysts have also recently commented on the stock. Argus lowered their price objective on shares of Constellation Brands from $260.00 to $210.00 and set a “buy” rating for the company in a research report on Friday. BMO Capital Markets lowered their price objective on shares of Constellation Brands to $225.00 and set an “outperform” rating for the company in a research report on Thursday. Wells Fargo & Co reiterated an “outperform” rating and set a $235.00 target price (down previously from $260.00) on shares of Constellation Brands in a report on Thursday. SunTrust Banks reiterated a “hold” rating on shares of Constellation Brands in a report on Thursday. Finally, Cowen reiterated a “top pick” rating on shares of Constellation Brands in a report on Thursday. One research analyst has rated the stock with a sell rating, eight have issued a hold rating, seventeen have issued a buy rating and two have given a strong buy rating to the company. The company presently has a consensus rating of “Buy” and a consensus target price of $228.09.

In other news, VP Thomas Michael Kane sold 4,419 shares of the firm’s stock in a transaction dated Friday, October 19th. The stock was sold at an average price of $223.83, for a total value of $989,104.77. Following the completion of the transaction, the vice president now owns 8,499 shares in the company, valued at approximately $1,902,331.17. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, CEO Robert Sands sold 151,060 shares of the firm’s stock in a transaction dated Monday, October 22nd. The shares were sold at an average price of $223.67, for a total value of $33,787,590.20. Following the completion of the transaction, the chief executive officer now owns 737,607 shares of the company’s stock, valued at approximately $164,980,557.69. The disclosure for this sale can be found here. Insiders sold a total of 578,723 shares of company stock valued at $129,438,449 in the last 90 days. 15.80% of the stock is owned by corporate insiders.

Several hedge funds and other institutional investors have recently made changes to their positions in STZ. Central Bank & Trust Co. lifted its stake in Constellation Brands by 0.4% in the 3rd quarter. Central Bank & Trust Co. now owns 21,961 shares of the company’s stock valued at $4,735,000 after purchasing an additional 89 shares during the last quarter. BW Gestao de Investimentos Ltda. lifted its stake in Constellation Brands by 1.2% in the 3rd quarter. BW Gestao de Investimentos Ltda. now owns 8,500 shares of the company’s stock valued at $1,833,000 after purchasing an additional 100 shares during the last quarter. Carroll Financial Associates Inc. lifted its stake in Constellation Brands by 132.0% in the 4th quarter. Carroll Financial Associates Inc. now owns 283 shares of the company’s stock valued at $48,000 after purchasing an additional 161 shares during the last quarter. Tower View Investment Management & Research LLC lifted its stake in Constellation Brands by 2.5% in the 4th quarter. Tower View Investment Management & Research LLC now owns 8,589 shares of the company’s stock valued at $1,381,000 after purchasing an additional 208 shares during the last quarter. Finally, Benjamin F. Edwards & Company Inc. lifted its stake in Constellation Brands by 49.3% in the 3rd quarter. Benjamin F. Edwards & Company Inc. now owns 787 shares of the company’s stock valued at $170,000 after purchasing an additional 260 shares during the last quarter. Institutional investors own 72.56% of the company’s stock.

The company has a market cap of $28.60 billion, a PE ratio of 18.26, a PEG ratio of 1.57 and a beta of 0.38. The company has a current ratio of 1.66, a quick ratio of 0.76 and a debt-to-equity ratio of 0.80.

Constellation Brands (NYSE:STZ) last issued its earnings results on Wednesday, January 9th. The company reported $2.37 earnings per share (EPS) for the quarter, beating the Thomson Reuters’ consensus estimate of $2.04 by $0.33. Constellation Brands had a net margin of 35.27% and a return on equity of 18.27%. The business had revenue of $1.97 billion during the quarter, compared to the consensus estimate of $1.91 billion. During the same period last year, the business posted $2.00 EPS. Constellation Brands’s revenue was up 9.5% on a year-over-year basis. Equities research analysts expect that Constellation Brands, Inc. will post 9.25 EPS for the current year.

The company also recently announced a quarterly dividend, which will be paid on Tuesday, February 26th. Investors of record on Tuesday, February 12th will be paid a $0.74 dividend. The ex-dividend date is Monday, February 11th. This represents a $2.96 annualized dividend and a yield of 1.86%. Constellation Brands’s dividend payout ratio (DPR) is currently 10.67%.

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About Constellation Brands (NYSE:STZ)

Constellation Brands, Inc, together with its subsidiaries, produces, imports, and markets beer, wine, and spirits in the United States, Canada, Mexico, New Zealand, and Italy. The company sells wine across various categories, including table wine, sparkling wine, and dessert wine. It provides beer primarily under the Corona Extra, Corona Light, Modelo Especial, Modelo Negra, Modelo Chelada, Pacifico, and Victoria brands, as well as Funky Buddha, Obregon Brewery, and Ballast Point brands.

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