Constellation Brands shares will get a boost as demand for beer remains strong, according to the Bank of Montreal.

Analyst Andrew Strelzik began covering the brands of Constellation Brands (STZ) because, according to him, there were no signs of a slowdown in consumer spending with the company’s main beer brands.

“Despite evidence of changing consumer behavior in other food/beverage categories, Mexican beer import data such as Modelo and Corona remain consistent with previous months. We hope that resilience continues.”

Strelzik wrote.

The analyst expects Constellation Brands to have “ample room” to expand distribution outside its core region and sustain strong beer sales in the coming years. This supports the view that there is potential for increasing the company’s beer revenue orientation.

According to the analyst, the solid perspective of multi-year growth results in an attractive investment with favorable risk-return.

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“We see a potential upside for beer revenue guidance in FY23,” added Strelzik, giving Constellation a price target of $290, about 20% up on Monday’s (01) closing price of $244.15.

Constellation’s stock outperformed the broader market this year, falling just 2.7%.

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