Constellation: Medium-Term Sales Targets Intact on Robust Beer Outlook, Organic Growth in Focus 

We plan to maintain our $274 fair value estimate after combing through wide-moat Constellation’s medium-term sales growth and margin targets reaffirmed at the firm’s strategy day event that squared with our projections for the core beer business but moderately exceeded our expectation for the wine and spirits segment. Our 10-year forecasts remain in place for mid-single-digit top-line growth and operating margins averaging in the mid-30s. Shares look undervalued, trading at a 12% discount to our intrinsic valuation, and we suggest long-term investors buy into this leading brewer of premium beers.