Constellation Brands Benefits From Modelo Beer Sales, Sending Shares Higher

By
Bill McColl
Bill McColl
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Bill McColl has 25+ years of experience as a senior producer and writer for TV, radio, and digital media leading teams of anchors, reporters, and editors in creating news broadcasts, covering some of the most notable news stories of the time.

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Published January 05, 2024
Modelo Especial beer

Mario Tama / Staff / Getty Images

Key Takeaways

  • Constellation Brands beat profit estimates on demand for its Modelo beers.
  • Sales of Modelo Especial were up about 12% from a year ago, helping it retain its title as the best-selling beer brand in the U.S., after surpassing Bud Light last year.
  • Wine and spirit sales struggled, and the company lowered its full-year outlook for those products.

Demand for Modelo beer helped Constellation Brands (STZ) post better-than-expected results, and shares gained close to 3% in intraday trading Friday.

The alcoholic beverage maker reported third quarter fiscal 2024 earnings per share (EPS) of $3.19, above forecasts. Revenue rose 1.4% from a year ago to $2.47 billion, short of estimates.

Beer sales were up 4% to $1.97 billion, led by an approximately 12% increase in sales of Modelo Especial. It remained the best-selling beer in America after overtaking Anheuser-Busch InBev’s (BUD) Bud Light last year amid controversy surrounding the brand's partnership with transgender social media influencer Dylan Mulvaney.

Wine and spirits revenue slipped 8% to $502 million, and Constellation warned about full-year demand, which it blamed on a broader marketplace deceleration and U.S. wholesale underperformance. The company now anticipates 2024 wine and spirits organic net sales to be down 7% to 9%, compared to its previous outlook of a 0.5% decline. 

Shares of Constellation Brands were up 2.8% at $249.13 per share as of about 2:30 p.m. ET Friday. They reached an all-time closing high in July after Modelo Especial took the title of America's top-selling beer brand from Bud Light, and they've gained more than 19% over the last year.

STZ

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  1. Constellation Brands. "CONSTELLATION BRANDS REPORTS THIRD QUARTER FISCAL 2024 FINANCIAL RESULTS."

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