Constellation Brands Is Executing Its High End Strategy To Perfection

Another quarter, another earnings beat for Constellation Brands, Inc. STZ.

The New York Based-Beer and Spirits distributor has become one of the most solid plays in the market, with Morgan Stanley called the company the Top Pick in the beverage industry.

Constellation is honing in on its acquisition strategy and is trimming the fat at the same time, recently announcing it's looking to sell its Canadian wine business for a reported $1 billion, to focus more on the U.S. and Mexican markets.

Related Link: Constellation Brands Is Morgan Stanley's Top Pick In Beverage

Constellation has a keen eye for acquisitions, and has been focused on super-high end products to bolster its portfolio. The company recently announced a $160 million dollar purchase high-end whiskey maker High West Distillery. The move allows Constellation to enter the $2.9 billion bourbon and rye market, where high-end brands have driven most of the industries growth since 2010.

Constellation executed its high-end strategy to perfection with its acquisition of Ballast Point Brewery in November 2015, for $1 billion, a record for a craft beer company.

Fastest Growing Craft Beer Brand

Ballast Point has remained the fastest growing craft beer company in the nation. What's unique about Ballast Point is that it has the highest pricing power in the industry and is still the fastest growing brand.

A household name on the West Coast, Constellation is ramping up the distribution capabilities of Ballast Point, as it's currently available in 43 states.

"[Ballast Point] continues to be the fastest growing major craft brand in the US and achieved solid high-double-digit depletion growth during the quarter," said CEO Rob Sands. "It's highly, highly profitable."