The beer-guzzling season started early this year for the maker of Corona and Negra Modelo — sending its stock up more than $12 a share.
Investors bid up shares of Constellation Brands more than 7 percent on Friday after the beer and wine maker said beer sales grew 7 percent during its fiscal first quarter.
The pop comes just weeks after investors sent the stock tumbling on fears that President Trump would impose hefty tariffs on Mexican imports — including beer — in a bid to pressure our southern neighbor to curb the flow of immigrants into the US.
Trump suspended the tariffs days before they were supposed to go into effect, and the two countries reached an agreement on border control.
As it turned out, fears of a US/Mexico trade war only served to boost beer shipments by importers — who rushed to “mitigate potential tariff risks,” Chief Financial Officer David Klein told investors on Friday.
Last week, Constellation’s stock took another hit after the company said it would book a roughly $78 million loss in the first quarter tied to its investment in Canadian weed grower Canopy Growth, which has a deal to make puppy pot treats with domestic diva Martha Stewart.
“While we remain happy with our investment in the cannabis space and its long-term potential, we were not pleased with Canopy’s recent reported year-end results,” Constellation Chief Executive Bill Newlands said on a call with analysts.
Still, investors sent the brew maker’s shares up nearly 7 percent to $200.55 in early trading, before the stock closed at $196.94, up 4.6 percent on the day.
Constellation, which also owns Svedka vodka and Mark West wine, said it earned $2.21 a share on revenue of $2.10 billion.
Analysts had been expecting the company to post $2.06 a share on revenue of $2.06 billion.
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Constellation execs said they expect the chugging to continue this summer — thanks to a mix of promotional activities planned for the beach season.
“I believe we are well-positioned throughout the remainder of the summer selling season,” Newlands said.