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Constellation Brands hits a 52-week high for third time this year

Published:  13 November, 2014

Constellation Brands (STZ) hit a 52-week high in trading yesterday, peaking at US$95.09 per share and closing the day at $94.02, which is the third time this year the company has hit a yearly record level.

Constellation has gone from strength to strength over the last 12 months and it doesn't appear to be slowing down as the Christmas trading period begins.

A major driver in the company's success was the acquisition Grupo Modelo's US commercial beer business.

In April Constellation Brands released its 2014 fiscal results and reported fourth quarter profits increased 92% to $157 million. Prior to its financial results in April, the company hit its first 52-week high of the year.

Rob Sands, president and chief executive of Constellation Brands, said at the time: "Our beer business exceeded our expectations for the year fuelled by robust consumer demand, strong sales execution and support from our wholesalers."

Sands said: "The overall portfolio continued to significantly outperform the growth of the US beer market with depletions increasing almost 8%, driven by Corona Extra and Modelo Especial, the fastest growing major beer brand."

In July the company hit its second 52-week high just prior to Constellation beating expectations for the quarter. It announced it had increased its fiscal year outlook for 2015 and reported that net sales had soared 127% year on year.

In September the company closed on Casa Noble Holdings tequila brands for undisclosed amount of money. Constellation did not have any tequila brands in its portfolio and saw an opportunity with the growth of super premium tequila in the US, which has seen substantial growth in recent years.

Last quarter the company did take a hit as it missed analysts earning per share (EPS) expectations coming in at $1.11 instead of  $1.15 EPS. However revenue was still showing positive gains increasing by 10.1% compared to the same quarter last year.

Analysts are expecting the company to post a $4.24 earnings per share for the fiscal year which will meet current targets. Constellation raised earnings per share for 2015 from US$3.95-$4.15 to $4.10-$4.25.