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Constellation Brands (STZ) Stock Falls on Q1 Earnings Miss

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Constellation Brands Inc. (STZ - Free Report) , a leading international producer and marketer of beverage alcohol brands, released first-quarter fiscal 2018 results, wherein adjusted earnings of $2.20 per share lagged the Zacks Consensus Estimate of $2.42. Moreover, the bottom line declined 5% from $2.32 a share earned in the year-ago quarter.

Constellation Brands reiterated its adjusted earnings per share view for fiscal 2019, while it raised GAAP earnings per share forecast. The company projects adjusted earnings per share of $9.40–$9.70 and GAAP earnings of $10.93–$11.23.

Earnings Estimate Revision: The Zacks Consensus Estimate has been witnessing a decline in the last 30 days. However, Constellation Brands’ performance in the trailing four quarters (including the quarter under review) gives a positive picture. The company outperformed the Zacks Consensus Estimate by an average of 12.2% in the trailing four quarters.

Revenues: Constellation Brands generated net sales of $2,047.1 million that increased 6% year over year and surpassed the Zacks Consensus Estimate of $2,040 million driven by 11% rise in beer, offset by 2.5% decline in wine and spirits sales.

The company anticipates beer business sales to grow 9–11% in fiscal 2019, while sales for the wine and spirits business is expected to increase 2–4%.

Key Events: Constellation Brands declared a quarterly cash dividend of 74 cents per share for Class A shares and 67 cents per share for Class B shares. These dividends are payable on Aug 24, to shareholders with record as on Aug 10.

Zacks Rank: Currently, Constellation Brands carries a Zacks Rank #3 (Hold) which is subject to change following the earnings announcement. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Stock Movement: Constellation Brands’ shares declined 4.3% during pre-market trading hours following the earnings release. Investors developed a negative sentiment owing to the lower-than-expected bottom line results.

Check back later for our full write up on Constellation Brands’ earnings report!

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