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Constellation Brands Inc A
STZ : NYSE : Consumer Goods
$134.95 -3.00 | -2.17%
Today's Range: 130.23 - 136.42
Avg. Daily Volume: 1,460,600
02/08/16 - 4:01 PM ET

Financial Analysis


CONSTELLATION BRANDS's gross profit margin for the third quarter of its fiscal year 2015 has increased when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. CONSTELLATION BRANDS has weak liquidity. Currently, the Quick Ratio is 0.63 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

During the same period, stockholders' equity ("net worth") has increased by 15.21% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q3 FY15 Q3 FY14
Net Sales ($mil)1640.51541.7
EBITDA ($mil)509.8444.0
EBIT ($mil)458.5392.4
Net Income ($mil)270.5222.2


Balance Sheet Q3 FY15 Q3 FY14
Cash & Equiv. ($mil)491.367.3
Total Assets ($mil)16156.614980.5
Total Debt ($mil)7403.07318.8
Equity ($mil)6492.45635.0


Profitability Q3 FY15 Q3 FY14
Gross Profit Margin48.3645.36
EBITDA Margin31.0728.79
Operating Margin27.9525.45
Sales Turnover0.390.4
Return on Assets6.355.21
Return on Equity15.813.87
Debt Q3 FY15 Q3 FY14
Current Ratio1.82.43
Debt/Capital0.530.57
Interest Expense75.686.4
Interest Coverage6.064.54


Share Data Q3 FY15 Q3 FY14
Shares outstanding (mil)199.23193.39
Div / share0.310.0
EPS1.331.1
Book value / share32.5929.14
Institutional Own % n/a n/a
Avg Daily Volume1449155.01361659.0

Valuation


BUY. CONSTELLATION BRANDS's P/E ratio indicates a premium compared to an average of 26.66 for the Beverages industry and a premium compared to the S&P 500 average of 21.13. To use another comparison, its price-to-book ratio of 4.51 indicates a significant premium versus the S&P 500 average of 2.51 and a significant discount versus the industry average of 7.28. The current price-to-sales ratio is well above the S&P 500 average and above the industry average, indicating a premium. The valuation analysis reveals that, CONSTELLATION BRANDS seems to be trading at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
STZ 29.04 Peers 26.66   STZ 20.53 Peers 20.04

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

STZ is trading at a valuation on par with its peers.

 

Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

STZ is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
STZ 24.01 Peers 23.57   STZ 1.00 Peers 2.38

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

STZ is trading at a premium to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

STZ trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
STZ 4.51 Peers 7.28   STZ 29.74 Peers -8.15

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

STZ is trading at a significant discount to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

STZ is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
STZ 4.60 Peers 4.19   STZ 6.68 Peers -4.37

Average. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

STZ is trading at a valuation on par with its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

STZ has a sales growth rate that significantly exceeds its peers.

 

 

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