CONSTELLATION BRANDS INC-A (STZ) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:STZ - US21036P1084 - Common Stock
160.72 USD
-2.66 (-1.63%)
160.5 USD
-0.22 (-0.14%)
Overall STZ gets a fundamental rating of 5 out of 10. We evaluated STZ against 33 industry peers in the Beverages industry. Both the profitability and the financial health of STZ get a neutral evaluation. Nothing too spectacular is happening here. STZ has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
- STZ had positive earnings in the past year.
- In the past year STZ had a positive cash flow from operations.
- In multiple years STZ reported negative net income over the last 5 years.
- STZ had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- STZ has a Return On Assets (5.12%) which is in line with its industry peers.
- STZ has a Return On Equity (14.39%) which is comparable to the rest of the industry.
- STZ's Return On Invested Capital of 12.66% is fine compared to the rest of the industry. STZ outperforms 72.73% of its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for STZ is in line with the industry average of 11.45%.
- The last Return On Invested Capital (12.66%) for STZ is above the 3 year average (12.24%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.12% | ||
| ROE | 14.39% | ||
| ROIC | 12.66% |
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
- STZ's Profit Margin of 11.83% is fine compared to the rest of the industry. STZ outperforms 75.76% of its industry peers.
- Looking at the Operating Margin, with a value of 33.76%, STZ belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
- STZ's Operating Margin has improved in the last couple of years.
- The Gross Margin of STZ (52.60%) is better than 63.64% of its industry peers.
- STZ's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 33.76% | ||
| PM (TTM) | 11.83% | ||
| GM | 52.6% |
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
- STZ has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
- Compared to 1 year ago, STZ has less shares outstanding
- The number of shares outstanding for STZ has been reduced compared to 5 years ago.
- Compared to 1 year ago, STZ has a worse debt to assets ratio.
2.2 Solvency
- STZ has an Altman-Z score of 3.03. This indicates that STZ is financially healthy and has little risk of bankruptcy at the moment.
- STZ has a better Altman-Z score (3.03) than 60.61% of its industry peers.
- STZ has a debt to FCF ratio of 6.05. This is a slightly negative value and a sign of low solvency as STZ would need 6.05 years to pay back of all of its debts.
- The Debt to FCF ratio of STZ (6.05) is better than 60.61% of its industry peers.
- A Debt/Equity ratio of 1.38 is on the high side and indicates that STZ has dependencies on debt financing.
- The Debt to Equity ratio of STZ (1.38) is worse than 78.79% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.38 | ||
| Debt/FCF | 6.05 | ||
| Altman-Z | 3.03 |
ROIC/WACC1.78
WACC7.11%
2.3 Liquidity
- A Current Ratio of 1.34 indicates that STZ should not have too much problems paying its short term obligations.
- STZ has a Current ratio of 1.34. This is comparable to the rest of the industry: STZ outperforms 54.55% of its industry peers.
- STZ has a Quick Ratio of 1.34. 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 Quick ratio of 0.70. This is comparable to the rest of the industry: STZ outperforms 45.45% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.34 | ||
| Quick Ratio | 0.7 |
3. Growth
3.1 Past
- STZ shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -6.42%.
- Measured over the past years, STZ shows a quite strong growth in Earnings Per Share. The EPS has been growing by 8.57% on average per year.
- STZ shows a decrease in Revenue. In the last year, the revenue decreased by -7.86%.
- STZ shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.12% yearly.
EPS 1Y (TTM)-6.42%
EPS 3Y10.52%
EPS 5Y8.57%
EPS Q2Q%-5.85%
Revenue 1Y (TTM)-7.86%
Revenue growth 3Y4.99%
Revenue growth 5Y4.12%
Sales Q2Q%-9.78%
3.2 Future
- The Earnings Per Share is expected to grow by 2.39% on average over the next years.
- The Revenue is expected to decrease by -0.10% on average over the next years.
EPS Next Y-15.73%
EPS Next 2Y-4.65%
EPS Next 3Y-1.61%
EPS Next 5Y2.39%
Revenue Next Year-10.89%
Revenue Next 2Y-5.44%
Revenue Next 3Y-2.93%
Revenue Next 5Y-0.1%
3.3 Evolution
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- STZ is valuated correctly with a Price/Earnings ratio of 12.82.
- STZ's Price/Earnings ratio is rather cheap when compared to the industry. STZ is cheaper than 81.82% of the companies in the same industry.
- STZ is valuated cheaply when we compare the Price/Earnings ratio to 27.30, which is the current average of the S&P500 Index.
- Based on the Price/Forward Earnings ratio of 12.84, the valuation of STZ can be described as correct.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of STZ indicates a rather cheap valuation: STZ is cheaper than 81.82% of the companies listed in the same industry.
- Compared to an average S&P500 Price/Forward Earnings ratio of 24.32, STZ is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.82 | ||
| Fwd PE | 12.84 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, STZ is valued a bit cheaper than 69.70% of the companies in the same industry.
- Based on the Price/Free Cash Flow ratio, STZ is valued cheaper than 81.82% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.87 | ||
| EV/EBITDA | 10.64 |
4.3 Compensation for Growth
- STZ has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.5
EPS Next 2Y-4.65%
EPS Next 3Y-1.61%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 2.57%, STZ has a reasonable but not impressive dividend return.
- STZ's Dividend Yield is a higher than the industry average which is at 1.73.
- Compared to an average S&P500 Dividend Yield of 1.82, STZ pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.57% |
5.2 History
- The dividend of STZ is nicely growing with an annual growth rate of 6.29%!
- STZ has paid a dividend for at least 10 years, which is a reliable track record.
- STZ has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)6.29%
Div Incr Years9
Div Non Decr Years9
5.3 Sustainability
- STZ pays out 64.83% of its income as dividend. This is not a sustainable payout ratio.
- The dividend of STZ is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP64.83%
EPS Next 2Y-4.65%
EPS Next 3Y-1.61%
CONSTELLATION BRANDS INC-A / STZ FAQ
What is the ChartMill fundamental rating of CONSTELLATION BRANDS INC-A (STZ) stock?
ChartMill assigns a fundamental rating of 5 / 10 to STZ.
What is the valuation status for STZ stock?
ChartMill assigns a valuation rating of 6 / 10 to CONSTELLATION BRANDS INC-A (STZ). This can be considered as Fairly Valued.
How profitable is CONSTELLATION BRANDS INC-A (STZ) stock?
CONSTELLATION BRANDS INC-A (STZ) has a profitability rating of 6 / 10.
What is the financial health of CONSTELLATION BRANDS INC-A (STZ) stock?
The financial health rating of CONSTELLATION BRANDS INC-A (STZ) is 4 / 10.
What is the earnings growth outlook for CONSTELLATION BRANDS INC-A?
The Earnings per Share (EPS) of CONSTELLATION BRANDS INC-A (STZ) is expected to decline by -15.73% in the next year.