On Wednesday, Constellation Brands Inc. STZ announced better-than-anticipated earnings at $1.77 per share (consensus $1.65) and announced plans to add Utah’s High West Distillery to the company portfolio.
On Thursday, Morgan Stanley analyst Dara Mohsenian maintained an Overweight rating, while raising its price target for Constellation from $191 to $194.
“We believe the market is not appropriately discounting the company's strong Long-Term growth prospects,” said Mohsenian.
The analyst specified under-anticipated beer revenue growth as productivity increases, and rebounding wine results due to brand performance and growth acquisition as reasons for the bullish rating.
“(Contellation) remains our top beverage pick here, with outsized growth potential vs beverage peers,” said Mohsenian.
At time of writing, shares of Constellation were trading slightly up at $170.62.
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