CONSTELLATION BRANDS INC-A (STZ) Stock Fundamental Analysis
NYSE:STZ - New York Stock Exchange, Inc. - US21036P1084 - Common Stock - Currency: USD
Taking everything into account, STZ scores 4 out of 10 in our fundamental rating. STZ was compared to 32 industry peers in the Beverages industry. While STZ is still in line with the averages on profitability rating, there are concerns on its financial health. STZ is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
STZ had positive earnings in the past year.
STZ had a positive operating cash flow in the past year.
In multiple years STZ reported negative net income over the last 5 years.
In the past 5 years STZ always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of STZ (-0.38%) is worse than 68.75% of its industry peers.
STZ has a worse Return On Equity (-1.18%) than 62.50% of its industry peers.
The Return On Invested Capital of STZ (15.01%) is better than 81.25% of its industry peers.
The Average Return On Invested Capital over the past 3 years for STZ is in line with the industry average of 12.12%.
The last Return On Invested Capital (15.01%) for STZ is above the 3 year average (12.24%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.38% | ||
| ROE | -1.18% | ||
| ROIC | 15.01% |
ROA(3y)2.02%
ROA(5y)2.65%
ROE(3y)5.23%
ROE(5y)6.01%
ROIC(3y)12.24%
ROIC(5y)11.12%
1.3 Margins
With an excellent Operating Margin value of 34.10%, STZ belongs to the best of the industry, outperforming 96.88% of the companies in the same industry.
STZ's Operating Margin has improved in the last couple of years.
STZ's Gross Margin of 52.26% is fine compared to the rest of the industry. STZ outperforms 65.63% of its industry peers.
STZ's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 34.1% | ||
| PM (TTM) | N/A | ||
| GM | 52.26% |
OM growth 3Y0.41%
OM growth 5Y2.07%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.64%
GM growth 5Y0.98%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), STZ is creating value.
STZ has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, STZ has less shares outstanding
STZ has a worse debt/assets ratio than last year.
2.2 Solvency
STZ has a debt to FCF ratio of 5.93. This is a neutral value as STZ would need 5.93 years to pay back of all of its debts.
STZ's Debt to FCF ratio of 5.93 is fine compared to the rest of the industry. STZ outperforms 62.50% of its industry peers.
STZ has a Debt/Equity ratio of 1.47. This is a high value indicating a heavy dependency on external financing.
STZ has a Debt to Equity ratio of 1.47. This is in the lower half of the industry: STZ underperforms 62.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.47 | ||
| Debt/FCF | 5.93 | ||
| Altman-Z | N/A |
ROIC/WACC1.95
WACC7.69%
2.3 Liquidity
A Current Ratio of 0.92 indicates that STZ may have some problems paying its short term obligations.
STZ has a worse Current ratio (0.92) than 62.50% of its industry peers.
STZ has a Quick Ratio of 0.92. This is a bad value and indicates that STZ is not financially healthy enough and could expect problems in meeting its short term obligations.
STZ has a worse Quick ratio (0.56) than 62.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.92 | ||
| Quick Ratio | 0.56 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 14.18% over the past year.
STZ shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 8.57% yearly.
The Revenue has been growing slightly by 2.48% in the past year.
STZ shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.12% yearly.
EPS 1Y (TTM)14.18%
EPS 3Y10.52%
EPS 5Y8.57%
EPS Q2Q%16.37%
Revenue 1Y (TTM)2.48%
Revenue growth 3Y4.99%
Revenue growth 5Y4.12%
Sales Q2Q%1.17%
3.2 Future
The Earnings Per Share is expected to grow by 6.89% on average over the next years.
Based on estimates for the next years, STZ will show a small growth in Revenue. The Revenue will grow by 3.85% on average per year.
EPS Next Y3.82%
EPS Next 2Y6.07%
EPS Next 3Y4.95%
EPS Next 5Y6.89%
Revenue Next Year0.05%
Revenue Next 2Y1.03%
Revenue Next 3Y1.6%
Revenue Next 5Y3.85%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 13.55, which indicates a correct valuation of STZ.
93.75% of the companies in the same industry are more expensive than STZ, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 28.29, STZ is valued rather cheaply.
The Price/Forward Earnings ratio is 13.05, which indicates a correct valuation of STZ.
STZ's Price/Forward Earnings ratio is rather cheap when compared to the industry. STZ is cheaper than 93.75% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of STZ to the average of the S&P500 Index (21.08), we can say STZ is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.55 | ||
| Fwd PE | 13.05 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, STZ is valued a bit cheaper than the industry average as 68.75% of the companies are valued more expensively.
84.38% of the companies in the same industry are more expensive than STZ, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 17.4 | ||
| EV/EBITDA | 11.29 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates STZ does not grow enough to justify the current Price/Earnings ratio.
PEG (NY)3.55
PEG (5Y)1.58
EPS Next 2Y6.07%
EPS Next 3Y4.95%
5. Dividend
5.1 Amount
STZ has a Yearly Dividend Yield of 2.19%.
Compared to an average industry Dividend Yield of 3.02, STZ has a dividend in line with its industry peers.
STZ's Dividend Yield is comparable with the S&P500 average which is at 2.52.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.19% |
5.2 History
The dividend of STZ is nicely growing with an annual growth rate of 6.14%!
STZ has been paying a dividend for at least 10 years, so it has a reliable track record.
As STZ did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)6.14%
Div Incr Years9
Div Non Decr Years9
5.3 Sustainability
The earnings of STZ are negative and hence is the payout ratio. STZ will probably not be able to sustain this dividend level.
STZ's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP-899.02%
EPS Next 2Y6.07%
EPS Next 3Y4.95%
186.63
+3.6 (+1.97%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryBeverages
Earnings (Last)
Earnings (Next)
Inst Owners79.59%
Inst Owner Change-0.03%
Ins Owners0.09%
Ins Owner Change-0.35%
Market Cap33.73B
Analysts73.33
Price Target233.19 (24.95%)
Short Float %2.37%
Short Ratio1.37
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.19% |
Yearly Dividend4.03
Dividend Growth(5Y)6.14%
DP-899.02%
Div Incr Years9
Div Non Decr Years9
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)5.7%
Min EPS beat(2)-2.92%
Max EPS beat(2)14.31%
EPS beat(4)3
Avg EPS beat(4)4.58%
Min EPS beat(4)-2.92%
Max EPS beat(4)14.31%
EPS beat(8)7
Avg EPS beat(8)5.21%
EPS beat(12)10
Avg EPS beat(12)5.25%
EPS beat(16)12
Avg EPS beat(16)4.38%
Revenue beat(2)1
Avg Revenue beat(2)-1.55%
Min Revenue beat(2)-3.72%
Max Revenue beat(2)0.61%
Revenue beat(4)1
Avg Revenue beat(4)-1.17%
Min Revenue beat(4)-3.72%
Max Revenue beat(4)0.61%
Revenue beat(8)3
Avg Revenue beat(8)-0.9%
Revenue beat(12)6
Avg Revenue beat(12)0.39%
Revenue beat(16)9
Avg Revenue beat(16)0.6%
PT rev (1m)-5.38%
PT rev (3m)-20.93%
EPS NQ rev (1m)-1.94%
EPS NQ rev (3m)-9.01%
EPS NY rev (1m)-0.26%
EPS NY rev (3m)-1.84%
Revenue NQ rev (1m)-0.65%
Revenue NQ rev (3m)-4.99%
Revenue NY rev (1m)-0.22%
Revenue NY rev (3m)-1.86%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.55 | ||
| Fwd PE | 13.05 | ||
| P/S | 3.3 | ||
| P/FCF | 17.4 | ||
| P/OCF | 10.7 | ||
| P/B | 4.9 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.29 |
EPS(TTM)13.77
EY7.38%
EPS(NY)14.3
Fwd EY7.66%
FCF(TTM)10.72
FCFY5.75%
OCF(TTM)17.44
OCFY9.35%
SpS56.49
BVpS38.08
TBVpS-4.3
PEG (NY)3.55
PEG (5Y)1.58
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.38% | ||
| ROE | -1.18% | ||
| ROCE | 19.76% | ||
| ROIC | 15.01% | ||
| ROICexc | 15.07% | ||
| ROICexgc | 25.86% | ||
| OM | 34.1% | ||
| PM (TTM) | N/A | ||
| GM | 52.26% | ||
| FCFM | 18.98% |
ROA(3y)2.02%
ROA(5y)2.65%
ROE(3y)5.23%
ROE(5y)6.01%
ROIC(3y)12.24%
ROIC(5y)11.12%
ROICexc(3y)12.3%
ROICexc(5y)11.2%
ROICexgc(3y)22.37%
ROICexgc(5y)20.22%
ROCE(3y)15.97%
ROCE(5y)14.37%
ROICexcg growth 3Y11.53%
ROICexcg growth 5Y13.24%
ROICexc growth 3Y14.12%
ROICexc growth 5Y13.2%
OM growth 3Y0.41%
OM growth 5Y2.07%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.64%
GM growth 5Y0.98%
F-Score5
Asset Turnover0.47
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.47 | ||
| Debt/FCF | 5.93 | ||
| Debt/EBITDA | 2.57 | ||
| Cap/Depr | 272.4% | ||
| Cap/Sales | 11.89% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 80.27% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.92 | ||
| Quick Ratio | 0.56 | ||
| Altman-Z | N/A |
F-Score5
WACC7.69%
ROIC/WACC1.95
Cap/Depr(3y)275.65%
Cap/Depr(5y)283.18%
Cap/Sales(3y)11.86%
Cap/Sales(5y)11.45%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)14.18%
EPS 3Y10.52%
EPS 5Y8.57%
EPS Q2Q%16.37%
EPS Next Y3.82%
EPS Next 2Y6.07%
EPS Next 3Y4.95%
EPS Next 5Y6.89%
Revenue 1Y (TTM)2.48%
Revenue growth 3Y4.99%
Revenue growth 5Y4.12%
Sales Q2Q%1.17%
Revenue Next Year0.05%
Revenue Next 2Y1.03%
Revenue Next 3Y1.6%
Revenue Next 5Y3.85%
EBIT growth 1Y6.89%
EBIT growth 3Y5.43%
EBIT growth 5Y6.27%
EBIT Next Year17.02%
EBIT Next 3Y5.73%
EBIT Next 5Y8.94%
FCF growth 1Y28.27%
FCF growth 3Y4.91%
FCF growth 5Y1.21%
OCF growth 1Y13.39%
OCF growth 3Y5.23%
OCF growth 5Y4.32%