Benzinga | Jun 30, 2021 10:33AM EDT

Constellation Brands Shares Gain On Q1 Beats, Strong FY22 Guidance, Incremental Stock Buyback

* Constellation Brands Inc (NYSE:STZ) reported first-quarter FY22 sales of $2.03 billion, up 3.2% year-on-year, beating the consensus estimate of $2.02 billion.

* Net sales for the Beer segment grew 14% Y/Y to $1.5 billion, and wine and spirits were fell 22% Y/Y to 454.5 million.

* Shipment volume for beer increased 11.3%, while that of wine and spirits declined 38%.

* Gross profit of $1.1 billion grew 13.26% Y/Y. Gross margin of 54.3% expanded 170 basis points.

* Operating margin of 35.7% expanded by 50 basis points.

* EPS of $2.33 up 1.3% Y/Y beat the consensus estimate of $2.32.

* The company generated an operating cash flow of $716 million, a free cash flow of $602.1 million, and ended the quarter with $503.8 million in cash and equivalents.

* Guidance: Constellation sees FY22 reported EPS of $2.70- $3.00 and raised adjusted EPS outlook to $10-$10.30, versus $10.02 consensus.

* Stock Buyback: The company repurchased 2.2 million shares of common stock for $523 million through June of fiscal 2022 and announced an incremental stock buyback of $500 million.

* "Our Beer Business delivered double-digit net sales and profit growth, and our Wine & Spirits Business is poised to drive accelerated growth and profitability from its portfolio of high-end, industry-leading brands," said Bill Newlands, Chief Executive Officer.

* Price action: STZ shares are trading higher by 2.02% at $235.65 on the last check Wednesday.

* Photo by stokpic from Pixabay