STZ - Constellation Brands attracts bull rating from BMO Capital Markets

BMO Capital Markets started off coverage on Constellation Brands ( NYSE: STZ ) with an Outperform rating as it pointed to strong beer trends for key brands Modelo and Corona in the U.S.

STZ is called an attractive investment with a favorable risk-reward profile as the beer stock balances a solid multi-year growth outlook with a valuation discount to peers that is too wide.

Analyst Andrew Strelzik: "We have seen no signs of slowing consumer spending on STZ’s key beer brands and expect continued resiliency... Despite evidence of changing consumer behavior in other food/beverage categories, measured channel data for STZ’s beer brands and Mexico beer import data remains consistent with -- if not ahead of -- prior months."

The firm thinks STZ is likely to outperform its previously issued beer revenue guidance.

BMO assigned a price target of $290 to Constellation Brand to rep more than 18% upside potential for shares.

The Seeking Alpha Quant Rating on STZ is flashing Hold.

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