The stock of Constellation Brands (STZ) fell 3% after the maker of alcoholic drinks reported mixed first-quarter financial results.
Constellation Brands, which makes beers such as Corona and Modelo Especial, reported
earnings per share (EPS) of $3.57 U.S., which topped Wall Street forecasts of $3.46 U.S.
However, the company’s revenue of $2.66 billion U.S. was slightly below consensus estimates of $2.67 billion U.S.
While Constellation’s beer sales increased 8% in Q1 from a year ago, sales of its wine and spirits decreased 7%.
Constellation’s beer business has grown steadily over the past decade. So much so that last year, Modelo became the top-selling beer in the U.S.
Unfortunately, the company’s success with its beer products has been offset by weak sales of wine and particularly spirits as consumers move away from drinking hard liquor.
Wine and spirits comprise one-fifth of the firm’s total sales.
The company has been working to grow its wine and spirit segment through increased advertising and price promotions.
In terms of guidance, Constellation Brands said that for the entire year, it expects earnings of $13.50 U.S. to $13.80 U.S. a share. Analysts had forecast EPS of $13.66 U.S.
The mixed financial results led Constellation Brands’ stock to finish trading on July 3 down 3%. The stock market in the U.S. is closed today (July 4) for the Independence Day holiday.
The company’s stock is flat (down 0.25%) over the last 12 months and currently trading at $250.37 U.S. per share.