Earnings Updates | Q2 2024

July 10, 2024by toleg.work

The corporate reporting period has is starting.

Last week, 2 companies from the S&P 500 index reported.

Today, we’re going to look at the results of Constellation Brands, which reported $2.6B in revenue. It grew by +1.5% compared to the corresponding value for the previous quarter, but did not exceed analysts’ expectations by -0.2%. Let’s analyze the company’s business in more detail.

Constellation Brands is one of the largest suppliers of alcoholic beverages in the United States, generating 80% of its revenue from imports of Mexican beer under the well-known brands Modelo and Corona. The company also owns a 36% stake in No-Moat Canopy Growth, a producer of medical and recreational cannabis in Canada, and has a joint venture with Owens-Illinois glass manufacturer in Mexico.

The company’s revenues increased by +4.0% quarter-on-quarter and by +23.8% month-on-month. This revenue growth was driven by increased demand from wholesale partners who stocked up on beverages ahead of the peak summer months. The company plans to develop the beer and soft drinks segment in the next quarter, as they are more popular among the 20-30 year old age group in the US compared to the wine and spirits segment.

47% of the revenue structure is made up of manufacturing costs and 53% of gross profit. Over the past quarter, the company earned a profit of $892M. Its market capitalization is $45B.

After the publication of the report, Constellation Brands shares rose by +3.6% to $259 per share. Market participants were satisfied with the financial results and reacted negatively to the company’s development prospects.

*surprise – % ratio between actual and expected revenue
**growth – % ratio of the amount of revenue for the last 4 quarters compared to this value calculated for the previous quarter

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