Constellation Brands Inc

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STZ : NYSE : Consumer Goods
$180.93 | %
Today's Range: 179.49 - 181.49
Avg. Daily Volume: 1411000.0
05/26/17 - 4:02 PM ET

Financial Analysis


CONSTELLATION BRANDS's gross profit margin for the fourth quarter of its fiscal year 2016 has increased when compared to the same period a year ago. The company has grown its sales and net income during the past quarter when compared with the same quarter a year ago, and although its growth in net income has outpaced the industry average, its revenue growth has not. CONSTELLATION BRANDS has very weak liquidity. Currently, the Quick Ratio is 0.38 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity decreased from the same period a year ago, despite already having very weak liquidity to begin with. This would indicate deteriorating cash flow.

During the same period, stockholders' equity ("net worth") has increased by 5.05% 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 Q4 FY16 Q4 FY15
Net Sales ($mil)1628.01543.2
EBITDA ($mil)526.4482.1
EBIT ($mil)462.2423.8
Net Income ($mil)452.0243.4


Balance Sheet Q4 FY16 Q4 FY15
Cash & Equiv. ($mil)177.483.1
Total Assets ($mil)18602.416965.0
Total Debt ($mil)9238.18081.2
Equity ($mil)6891.26559.6


Profitability Q4 FY16 Q4 FY15
Gross Profit Margin52.5649.44
EBITDA Margin32.3331.24
Operating Margin28.3927.46
Sales Turnover0.390.39
Return on Assets8.256.21
Return on Equity22.2716.08
Debt Q4 FY16 Q4 FY15
Current Ratio1.21.31
Debt/Capital0.570.55
Interest Expense77.583.9
Interest Coverage5.965.05


Share Data Q4 FY16 Q4 FY15
Shares outstanding (mil)194.6199.46
Div / share0.40.31
EPS2.261.19
Book value / share35.4132.89
Institutional Own % n/a n/a
Avg Daily Volume1479151.02002197.0

Valuation


BUY. The current P/E ratio indicates a significant discount compared to an average of 56.10 for the Beverages industry and a value on par with the S&P 500 average of 25.02. To use another comparison, its price-to-book ratio of 5.11 indicates a significant premium versus the S&P 500 average of 3.00 and a significant discount versus the industry average of 7.37. 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 23.98 Peers 56.10   STZ 20.75 Peers 21.05

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

STZ is trading at a significant discount to 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 20.55 Peers 24.22   STZ 4.10 Peers 1.51

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.

 

Premium. 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 premium to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
STZ 5.11 Peers 7.37   STZ 45.27 Peers 1.93

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 4.80 Peers 4.46   STZ 11.95 Peers 6.47

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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