Constellation Brands, a leading beverage company known for its Mexican beer portfolio, including brands like Modelo Especial and Corona Extra, has shown solid growth in its beer business. In the third quarter of fiscal 2024, Constellation Brands achieved a notable depletion growth of 8.2%, marking the 55th consecutive quarter of growth in this area [2881bd83]. This growth can be attributed to the company's focus on higher-end brands and its premiumization strategy, which have aligned well with consumer trends. The success of its high-end brands has contributed to Constellation Brands' strong sales growth in the beer segment.
In addition to its growth in the beer business, Constellation Brands has demonstrated a balanced approach to capital allocation. The company executed $215 million in share repurchases while maintaining a stable net leverage ratio. This commitment to delivering shareholder value is evident in its disciplined investment and share repurchase programs [2881bd83].
Constellation Brands is also focusing on enhancing its brewery capacities and reshaping its Wine & Spirits portfolio toward higher-end brands. The company plans to sell its wine and spirits business, a move that financial analyst Jim Cramer predicts will benefit the company and drive the stock price up [6be84f9b].
Molson Coors Beverage Company, formed by the merger of Molson Inc. and Adolph Coors Co., is a global manufacturer and seller of beer and other beverage products. The company has an impressive portfolio of owned and partner brands, including global priority brands like Blue Moon, Miller Lite, and Coors Light. Molson Coors Brewing (TAP) is currently ranked #2 (Buy) on the Zacks Rank and has a VGM Score of A. It also has a Value Style Score of A, indicating attractive valuation metrics. Eight analysts have revised their earnings estimate higher for fiscal 2024, and the Zacks Consensus Estimate has increased to $5.66 per share. With a solid Zacks Rank and top-tier Value and VGM Style Scores, TAP is recommended as a stock to watch and consider for investment [746efab2].
Big Beer companies like Molson Coors, Constellation Brands, and Anheuser-Busch InBev are diversifying their portfolios with flavorful concoctions to attract Gen Z drinkers. Gen Z, the youngest cohort of legal-aged drinkers from ages 21 to 26, are leaning towards flavor-forward categories and are drinking differently than previous generations. Smaller companies are dominating the beverage landscape, with brands like White Claw, E. & J. Gallo Winery's High Noon, and Two Chicks gaining popularity. Big Beer companies are expanding beyond beer and introducing beverages with fruity flavors and alternative ingredients. For example, Corona has launched the 'Sunbrew Citrus Cerveza,' a beer brewed with orange and lime peels and blended with juices to mimic the flavors of a popular cocktail. Molson Coors has introduced 'Happy Thursday,' a non-carbonated drink with fruit flavors, and Anheuser-Busch has seen success with its 'Beyond Beer' category, which includes NÃœTRL vodka seltzers and Cutwater Spirits canned cocktails. Despite declining beer sales and flat volume, Big Beer companies are adapting to the market and following consumer trends to stay relevant [856956f3].
Guggenheim has maintained its Buy rating on Constellation Energy Corporation and raised its share price target to $199.00 from $124.00. The adjustment comes as the analyst acknowledges the company's adoption of a bifurcated earnings per share (EPS) structure, which prompted a revision of their valuation model. Constellation Energy's redefined disclosure format and core valuation have been the catalysts for the new price target. The firm views Constellation Energy as a unique entity within the market, not fitting the traditional categories of utility or infrastructure investment. The analyst believes that the company's strategic positioning and financial metrics are appealing to investors, even as the company trades above the market average [0178e634].
Overall, Constellation Brands and Molson Coors Brewing continue to be solid choices for investors. The companies' strong growth in their respective beer businesses, diverse portfolio strategies, and commitment to delivering shareholder value make them attractive investment options [2881bd83] [746efab2] [856956f3].