_edited.png)
RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Constellation Brands, Inc. (XNYS:STZ) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
STZ
Name:
CONSTELLATION BRANDS, INC. (XNYS:STZ)
Sector:
602.10M
Industry:
Beverages�Wineries & Distilleries
CEO:
Mr. William Newlands
Total Employees:
10,000
Our Technological Advancement Rating
Our Rating:
-
-
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF CONSTELLATION BRANDS, INC.(STZ) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND BEVERAGES�WINERIES & DISTILLERIES INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
244.85
One Month Price Target:
$246.23
Six Month Price Target :
$253.15
Likely Price in One Year's Time:
Ticker:
$261.45
Likely Trading Range Today Under (Normal Volatility)
$244.16
Price Upper limit ($) :
$245.86
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$234.7
This week:
$222.15
This month :
$199.45
Other Primary facts
Market Cap:
46.30B
Market Cap Classification:
Large Cap
Number of Shares
IPO Date:
182.54M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
17.21%
-15.24%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$291.93
$270.17
$197.77
$219.53
Medium risk (<10%) entry points
Buy Call
Sell Call
$263.09
Buy Put:
Sell Put:
$258.45
$226.55
$231.25
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
STZ
Sharpe Ratio:
2.71%
Comparison:
STZ, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is 0.00% lower than the industry
& ratio is 19.10% higher than the market/S&P 500 average
Average Returns/Yield of
STZ
Daily returns:
0.06%
Weekly returns:
0.32%
Monthly returns:
1.29%
Yearly returns:
15.48%
Comparison of returns:
Average annual returns/yield (last 3 years) is 0.00% below industry average
Classification:
STZ, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.65
Statistical test of Returns:
STZ has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.05%
Weekly Volatility:
4.58%
Monthly Volatility:
9.17%
Yearly Volatility:
31.76%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.79%
Volatility in last five trading days has been -61.36% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-4.15%
Weekly VaR:
-9.27%
Monthly VaR:
-18.54%
How Much Can the price of
STZ
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-16%
Worst case (decline):
-64.23%
This translates to price declining to:
$206.52
This translates to price declining to:
$87.59
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
STZ is a 30.86% riskier investment compared to the market/S&P 500 & is 12.11% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 0.00% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
STZ
Beta in relation to market/S&P 500--1.01
Expected beta in 1 year's time:
0.728
Expected beta in 3 year's time:
1.029
Unlevered (debt free) Beta:
0.63
Beta in relation to Nasdaq (XNAS):
0.567
Beta in relation to all global stocks::
0.677
Beta Comparison & Analysis
Beta of competitors/peers::
0.55
Beta is 83.27% higher than peers
Average Industry Beta:
1.009
Beta is 0.00% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
-
-
Alpha provided | Alpha Analysis
Alpha provided:
0.054
Alpha is 0.00% below industry average alpha yield
Alpha is 345% higher than market/& is unsustainably high
Analysis of Cost of Capital of
STZ
Equity cost of capital:
0.101
Equity cost of capital is 0.00% below industry mean WACC
Unlevered (without debt) cost of capital:
6.28%
Before-tax cost of debt:
3.43%
After-tax cost of debt:
2.71%
Overall debt rating:
High AA grade (second highest grade)
Weighted average cost of capital (WACC):
2.71%
WACC is 0.00% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$51.14
Revenue growth rate per share of (3Y):
3.55
FALSE
EPS:
-$0.21
Expected Annual growth rate of EPS (3Y):
0.00%
-
Free cash flow (FCF) per share:
$9.81
Balance sheet equity growth per share: 44.66%
Equity growth rate per share is 0.00% lower than the industry
Debt per share
$54.32
EBITDA per share
$13.24
Valuation Analysis Today of
STZ
P/E Ratio:
36.91
P/E Ratio of Competitors/Peers:
20.93
-
-
-
Share value as per dividend discount (DDM) model: $39.74
Present value of the expected future dividends only: $32.98
P/S (Price to Sales ratio):
4.79
Price to sales ratio is 2.59% above the industry mean
P/B (Price to book value ratio):
3.55
Price to free cash flow: 24.96
FALSE
Net income growth rate (3Y):
-13.27%
Net income growth rate is 0.00% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 11.67%
Dividend yeild: 1.26%
Previous Dividend: $0.80
Previous adjusted dividend: $0.80
Previous Dividend: $3.08
Expected next dividend best case: $0.81
Expected next dividend worst case: $0.79
Average dividend payment (long-term): $0.76
Average dividend increase/decrease (growth rate) % per period: 0.66%
Expected next dividend payment date: 17/08/2022
Expected next dividend record date: 08/03/2022
Expected next dividend declaration date: 07/05/2022
Previous dividend payment date: 19/05/2022
Previous dividend record date: 05/05/2022
Previous dividend declaration date: 04/06/2022
Dividend History:
2022-05-04--$0.80
2021-11-04--$0.76
2021-05-03--$0.76
2022-02-08--$0.76
2021-08-09--$0.76
2021-02-08--$0.75
Dividend growth rate is 1585.39% higher than the average industry
In-depth Debt & Leverage Analysis
Debt to equity ratio:
80.86%
Net debt to equity ratio:
81.07%
Debt to assets ratio:
37.85%
Net debt to assets ratio:
37.95%
Debt-to-asset ratio is -30.88% below industry average
Ability to repay debt:
Interest coverage ratio:
6.75
Interest coverage ratio is -14.98% less than industry average
Looking forward:
Debt growth rate:
-10.43%
Annual debt growth is 0% lower than industry average debt growth rate
Debt repayment rate in last quarter: 0.07%
Analysis of Key Statistics
Correlation of price movement with the market:
0.635
Statistical significance of correlation:
STZ has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.635
Stock price is 0.00% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.635
Correlation of price movement with Nasdaq (^IXIC):
0.023
Covariance of price movement with the market:
0.027
Kurtosis
15.322
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
0.136
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
STZ
Gross Profit Margin Ratio:
208%
Operating Profit Margin Ratio:
32.92%
Operating profit margin is -5496.06% lower than the industry
Net Profit Margin Ratio:
208%
Effective Tax Rate:
25.68%
Effective tax rate is -75.48% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
10.25%
Return on equity (ROE) is -2439.98% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
4.80%
Return on assets (ROA) is -2416.21% lower than the industry
Financial Leverage:
1.6x
Current Ratio:
1.61
Current ratio is 6.96% above industry average
Cash Conversion Cycle (days):
-12.2
Cash conversion cycle is -114.45% below industry average
The remaining useful life of property plant & equipment is: 14.6 years
Stock based compensation to net income ratio:
1.27%
In-depth Efficiency Analysis
Revenue generated per employee:
933.5K
Each employee generates 0% less revenue than industry average revenue per employee
EBITDA generated per employee:
241.8K
Each employee generates 0% less EBITDA than industry average revenue per employee
Profit generated per employee:
125.7K
Each employee generates 0% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
60.2K
Each employee generates 0% less free cash flow than industry average revenue per employee
Assets/Capital per employee
2.3M
Each employee generates 0% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
STZ
STZ-B
KIMBERLY-CLARK CORPORATION (XNYS:KMB)
GENERAL MILLS, INC. (XNYS:GIS)
Ambev SA (XNYS:ABEV)
THE HERSHEY COMPANY (XNYS:HSY)
KEURIG DR PEPPER INC. (XNAS:KDP)
ARCHER-DANIELS-MIDLAND COMPANY (XNYS:ADM)
DOLLAR GENERAL CORPORATION (XNYS:DG)
THE KROGER CO. (XNYS:KR)
Current Analyst Ratings
Strong buy�21%
Buy�33%
Hold�25%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
5/31/22
Revenue:
9.33B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
4.49B
4.84B
-
-
1.77B
-
-
1.77B
-
358.20M
354.00M
2.42B
3.07B
1.26B
1.75B
448.30M
1.26B
Statement of Cash Flow
Date:
Period:
76.00M
Differed Income Tax :
- 98700.00K
Stock Based Compensation :
16.00M
Change in Working Capital :
62.20M
Accounts Receivables:
- 136700.00K
Other Working Capital:
130.50M
Other Non-Cash Items:
1.57B
Net Cash Provided by Operating Activities:
716.00M
Investments in PP&E:
- 113900.00K
Net Acquisitions:
- 3500.00K
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
5/31/21
2022
Q1
503.80M
-
503.80M
922.80M
1.38B
508.90M
3.31B
5.39B
7.81B
2.73B
3.73B
2.59B
623.00M
22.88B
-
26.19B
821.10M
529.40M
-
-
712.30M
2.06B
9.91B
-
11.53B
-
13.59B
2.20M
14.06B
- 236600.0K
- 1567600.00K
May 31, 2021 at 6:00:00 AM
6.26B
12.26B
25.86B
-
10.44B
9.9B
-
800.00K
- 116600.00K
- 7400.00K
-
- 400800.00K
- 146700.00K
- 1600.00K
- 556500.00K
300.00K
43.20M
503.80M
460.60M
716.00M
- 113900.00K
602.10M
Our Proprietary Portfolio Rating
Our Rating:
-
Price Forecast/Expected Price in Next 5 Years of
STZ
2023
2024
2025
2026
2027
$262.76
$171.24
$182.85
$195.24
$208.48