Buyers Belly Up to Constellation Brands After Wednesday's Big Stumble - TheStreet.com Thestreet.com - Thu 10 Jan 15:32 GMT
Buyers are bellying up to Constellation Brands as a number of analysts maintain the beer and wine giant's valuation has become more attractive for long-term investors thanks to a big drop in its shares on Wednesday....STZ
"We've have been challenged by the lower end of our [wine] business, which in totality has been flat or down," Constellation president William Newlands told analysts on the company's third-quarter earnings call.
Nonetheless, outgoing CEO Rob Sands argued that the company has worked diligently to deal with its challenges, declaring the stock was oversold and remains a tremendous value for investors looking to get in on the cheap
"The stock is an absolutely fantastic value," Sands said on "Mad Money" with Jim Cramer on Wednesday.
"We believe patience will pay off for medium- to long-term investors, as STZ has one of the strongest (if not the strongest) portfolios among publicly traded beer companies that we believe will continue to deliver outsized growth for years to come," J.P. Morgan analyst Pablo Zuanic wrote on Wednesday.
The company's valuation looks even more attractive based upon investors' ability to tap into the cannabis industry essentially free, something that could end up being a long-term growth driver and key to avoiding alcohol-sale cannibalization.
Meanwhile, Canopy Growth's stock surged more than 13% on Wednesday, making the drop in Constellation shares even more attractive given its possible takeover of the company.