Zacks Investment Research upgraded shares of Constellation Brands Inc. (STZ) from NEUTRAL to OUTPERFORM on January 22, 2013, with a target price of $43.00.
We upgrade our recommendation on Constellation Brands to Outperform following the company's strong third quarter fiscal 2013 results and increased visibility on the Crown deal, which is expected to close during the first quarter of calendar year 2013. The quarter witnessed higher sales volumes, better product mix, improved margins and lower taxes, which facilitated the company to post earnings of $0.63 per share that came ahead of the Zacks Consensus Estimate of $0.55 and surged 21% year over year. Net sales were also strong, rising 9% year over year to $766.9 million and surpassing the Zacks Consensus Estimate of $744 million. Consequently, the company now expects fiscal 2013 adjusted earnings in the range of $2.10-$2.20 per share, up from its earlier projection of $2.00-$2.10 per share. We believe, Constellation Brands, with a formidable portfolio of well known brands, new product offerings and strategic initiatives to strengthen its foothold in the U.S., holds a promising future.
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