Constellation Brands Inc

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STZ : NYSE : Consumer Goods
$162.47 -1.2 | -0.74%
Today's Range: 160.96 - 163.02
Avg. Daily Volume: 1947600.0
03/28/17 - 3:59 PM ET

Financial Analysis


CONSTELLATION BRANDS's gross profit margin for the third quarter of its fiscal year 2016 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 very weak liquidity. Currently, the Quick Ratio is 0.40 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

During the same period, stockholders' equity ("net worth") has increased by 8.09% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.

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Income Statement Q3 FY16 Q3 FY15
Net Sales ($mil)1810.51640.5
EBITDA ($mil)604.4509.8
EBIT ($mil)540.9458.5
Net Income ($mil)405.9270.5


Balance Sheet Q3 FY16 Q3 FY15
Cash & Equiv. ($mil)197.3491.3
Total Assets ($mil)18320.116156.6
Total Debt ($mil)8631.67403.0
Equity ($mil)7018.06492.4


Profitability Q3 FY16 Q3 FY15
Gross Profit Margin53.0148.36
EBITDA Margin33.3831.07
Operating Margin29.8827.95
Sales Turnover0.40.39
Return on Assets7.246.35
Return on Equity18.915.8
Debt Q3 FY16 Q3 FY15
Current Ratio1.311.8
Debt/Capital0.550.53
Interest Expense77.975.6
Interest Coverage6.946.06


Share Data Q3 FY16 Q3 FY15
Shares outstanding (mil)199.03199.23
Div / share0.40.31
EPS1.981.33
Book value / share35.2632.59
Institutional Own % n/a n/a
Avg Daily Volume1939343.01777079.0

Valuation


BUY. CONSTELLATION BRANDS's P/E ratio indicates a discount compared to an average of 32.19 for the Beverages industry and a value on par with the S&P 500 average of 26.33. To use another comparison, its price-to-book ratio of 4.61 indicates a significant premium versus the S&P 500 average of 2.93 and a significant discount versus the industry average of 8.65. The current price-to-sales ratio is well above the S&P 500 average and above the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, CONSTELLATION BRANDS proves to trade at a discount 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 25.15 Peers 32.19   STZ 18.66 Peers 20.98

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

STZ is trading at a discount to its peers.

 

Discount. 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 discount 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 21.60 Peers 23.39   STZ 0.89 Peers 1.99

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

STZ is trading at a valuation on par with 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 4.61 Peers 8.65   STZ 27.86 Peers 6.04

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 4.47 Peers 4.29   STZ 13.91 Peers 1.93

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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