In the latest trading session, Constellation Brands (STZ) closed at $210.18, marking a +0.88% move from the previous day. The stock lagged the S&P 500's daily gain of 1.08%. Meanwhile, the Dow gained 0.91%, and the Nasdaq, a tech-heavy index, added 1.31%.
Heading into today, shares of the wine, liquor and beer company had gained 11.3% over the past month, outpacing the Consumer Staples sector's gain of 0.85% and the S&P 500's loss of 0.68% in that time.
STZ will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $2.62, down 8.71% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $2.33 billion, up 1.42% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $8.35 per share and revenue of $7.90 billion, which would represent changes of -10.02% and -2.61%, respectively, from the prior year.
Investors should also note any recent changes to analyst estimates for STZ. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.18% lower. STZ is currently sporting a Zacks Rank of #3 (Hold).
Digging into valuation, STZ currently has a Forward P/E ratio of 24.96. This represents a premium compared to its industry's average Forward P/E of 24.81.
It is also worth noting that STZ currently has a PEG ratio of 3.13. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Beverages - Alcohol was holding an average PEG ratio of 3.52 at yesterday's closing price.
The Beverages - Alcohol industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 185, putting it in the bottom 28% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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