Constellation Brands Turns the Corner

Dear Client:Constellation Brands is at “the beginning of a multi-year turnaround,” says UBS senior analyst Kaumil Gajrawala in a note to clients, with cfo Bob Ryder as a “key driver behind the focus on improving returns.” The positives include: “(1) exclusive distributor relationships, (2) streamlined portfolios, (3) new compensation structure based on improving margins and FCF, (4) improved balance sheet. Importantly, UBS does not “believe any large-scale acquisitions are imminent” as Constellation execs are more focused on rationalizing their assets