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Is Constellation Brands (STZ) Likely to Beat on Q3 Earnings?
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Constellation Brands, Inc. (STZ - Free Report) is scheduled to release third-quarter fiscal 2021 results on Jan 7, 2021. This alcoholic beverage bigwig is likely to deliver revenue and earnings growth in the to-be-reported quarter. The Zacks Consensus Estimate for the company’s fiscal third-quarter earnings stands at $2.39, indicating 11.7% growth from the year-ago quarter’s reported figure. Further, the consensus mark has moved up 1.7% in the past seven days.
The consensus mark for revenues is pegged at $2,257 million, suggesting a 12.9% increase from the prior-year quarter’s reported figure.
In the last reported quarter, the company delivered an earnings surprise of 9.9%. Moreover, its bottom line beat estimates by 16.7%, on average, over the trailing four quarters.
Despite the impacts of the coronavirus outbreak, Constellation Brands has been gaining from robust depletions and strength in the off-premise channel. The depletion volume for the beer business has been benefiting from strength in the Modelo and Corona Brand Families. Also, depletion gains from robust off-premise channel sales have been offsetting the declines in the on-premise channel due to the coronavirus outbreak. Continuation of these trends in the off-premise business is expected to have aided depletions and the top line in the fiscal third quarter.
Moreover, continued strength in the Modelo and Corona brand families, and constant innovation have been driving portfolio depletions and market share gains. Additionally, the company’s wine & spirits premiumization strategy has been yielding results, as evident from the recent acceleration in depletions for the power brands, namely Kim Crawford, Meiomi and The Prisoner Brand Family.
Additionally, investments in e-commerce and increased hard seltzer market share have been acting as growth drivers. The Corona Hard Seltzer, launched earlier this year, has achieved the number four position in the category and is currently the second-fastest-moving hard seltzer. Market share gains in the fast-growing hard seltzer market are likely to have boosted the top line in the to-be-reported quarter.
Notably, in the last reported quarter, e-commerce for beverage alcohol has expanded significantly, increasing three to four times in volume from the prior year. Moreover, two-thirds of consumers plan to continue their e-commerce purchases even in the post-COVID situation. The digital business has been gaining share through platforms like Instacart, Drizly and other retailer online sites as consumers look for the convenience offered by these channels, which should bolster the results for the to-be-reported quarter.
However, lower shipments in the beer, and wine & spirits segments due to a decline in on-premise demand as bars and restaurants remain closed have been weighing on the top line. Notably, reduced production levels at its breweries in Mexico have been negatively impacting beer shipment volume.
Zacks Model
Our proven model predicts an earnings beat for Constellation Brands this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Constellation Brands has a Zacks Rank #3 and an Earnings ESP of +0.25%.
Other Stocks Poised to Beat Earnings Estimates
Here are some other companies you may want to consider, as our model too shows that these have the right combination of elements to deliver earnings beat:
Bed Bath & Beyond Inc. currently has an Earnings ESP of +32.28% and a Zacks Rank #3.
Kimberly-Clark Corporation (KMB - Free Report) presently has an Earnings ESP of +3.77% and a Zacks Rank #3.
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Is Constellation Brands (STZ) Likely to Beat on Q3 Earnings?
Constellation Brands, Inc. (STZ - Free Report) is scheduled to release third-quarter fiscal 2021 results on Jan 7, 2021. This alcoholic beverage bigwig is likely to deliver revenue and earnings growth in the to-be-reported quarter. The Zacks Consensus Estimate for the company’s fiscal third-quarter earnings stands at $2.39, indicating 11.7% growth from the year-ago quarter’s reported figure. Further, the consensus mark has moved up 1.7% in the past seven days.
The consensus mark for revenues is pegged at $2,257 million, suggesting a 12.9% increase from the prior-year quarter’s reported figure.
In the last reported quarter, the company delivered an earnings surprise of 9.9%. Moreover, its bottom line beat estimates by 16.7%, on average, over the trailing four quarters.
Constellation Brands Inc Price and EPS Surprise
Constellation Brands Inc price-eps-surprise | Constellation Brands Inc Quote
Key Factors to Note
Despite the impacts of the coronavirus outbreak, Constellation Brands has been gaining from robust depletions and strength in the off-premise channel. The depletion volume for the beer business has been benefiting from strength in the Modelo and Corona Brand Families. Also, depletion gains from robust off-premise channel sales have been offsetting the declines in the on-premise channel due to the coronavirus outbreak. Continuation of these trends in the off-premise business is expected to have aided depletions and the top line in the fiscal third quarter.
Moreover, continued strength in the Modelo and Corona brand families, and constant innovation have been driving portfolio depletions and market share gains. Additionally, the company’s wine & spirits premiumization strategy has been yielding results, as evident from the recent acceleration in depletions for the power brands, namely Kim Crawford, Meiomi and The Prisoner Brand Family.
Additionally, investments in e-commerce and increased hard seltzer market share have been acting as growth drivers. The Corona Hard Seltzer, launched earlier this year, has achieved the number four position in the category and is currently the second-fastest-moving hard seltzer. Market share gains in the fast-growing hard seltzer market are likely to have boosted the top line in the to-be-reported quarter.
Notably, in the last reported quarter, e-commerce for beverage alcohol has expanded significantly, increasing three to four times in volume from the prior year. Moreover, two-thirds of consumers plan to continue their e-commerce purchases even in the post-COVID situation. The digital business has been gaining share through platforms like Instacart, Drizly and other retailer online sites as consumers look for the convenience offered by these channels, which should bolster the results for the to-be-reported quarter.
However, lower shipments in the beer, and wine & spirits segments due to a decline in on-premise demand as bars and restaurants remain closed have been weighing on the top line. Notably, reduced production levels at its breweries in Mexico have been negatively impacting beer shipment volume.
Zacks Model
Our proven model predicts an earnings beat for Constellation Brands this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Constellation Brands has a Zacks Rank #3 and an Earnings ESP of +0.25%.
Other Stocks Poised to Beat Earnings Estimates
Here are some other companies you may want to consider, as our model too shows that these have the right combination of elements to deliver earnings beat:
The Procter & Gamble Company (PG - Free Report) has an Earnings ESP of +1.67% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Bed Bath & Beyond Inc. currently has an Earnings ESP of +32.28% and a Zacks Rank #3.
Kimberly-Clark Corporation (KMB - Free Report) presently has an Earnings ESP of +3.77% and a Zacks Rank #3.
Legal Marijuana: An Investor’s Dream
Imagine getting in early on a young industry primed to skyrocket from $17.7 billion in 2019 to an expected $73.6 billion by 2027.
Although marijuana stocks did better as the pandemic took hold than the market as a whole, they’ve been pushed down. This is exactly the right time to get in on selected strong companies at a fraction of their value before COVID struck. Zacks’ Special Report, Marijuana Moneymakers, reveals 10 exciting tickers for urgent consideration.
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