Constellation Brands, Inc. (STZ) will report financial results for its second quarter ended August 31, 2023, on Thursday, October 5, 2023, before the market opens. (1)
Constellation Brands is producer and marketer of beer, wine, and spirits with operations in the U.S., Mexico, and New Zealand. Its beer brands include: the Corona brand family like the flagship Corona Extra, Modelo Especial, and the flavorful lineup of Modelo Cheladas, Pacifico, and Victoria.
Non-beer brands include the Prisoner Wine Company, Robert Mondavi Winery, Casa Noble Tequila, High West Whiskey, Kim Crawford, and Meiomi wines.
Wall Street expects the alcoholic brewery to post earnings per share (EPS) of $3.35 with revenue hitting $2.82 billion. The bottom and top lines are higher than last year’s second quarter results of $3.17 and $2.51 billion, respectively. Profits were 36 cents higher than forecasted for the same quarter last year, STZ largest earnings surprise of the year. (2)
STZ went on a nice run following last year’s good news and the stock is setting up a similar trading pattern this year. As you’ll see on the chart below, Constellation Brands was in a downtrend, hit the low end of its Relative Strength Index (RSI) reading, found support, reported bullish earnings, and rebounded.
Fast forward one year and STZ is in a downtrend, RSI is at the low end of its range as the stock trades at a support level. All that’s left to complete the same cycle is repeat EPS performance and a stock price rebound. STX’s 50-day moving average of $263 might be a logical upside target initially. To the south, support emerges at $245 and then the 200-day benchmark of $238.
Of course, trading earnings is risky and only appropriate for the most aggressive investors who can afford to lose money in short timeframes.
Rich Meyers
1 – https://ir.cbrands.com/news-events/press-releases/detail/281/constellation-brands-to-report-second-quarter-fiscal-2024
2 – https://finance.yahoo.com/quote/STZ/analysis?p=STZ