Constellation Brands on Jan. 5 announced the early redemption of all of its outstanding 3.75% senior notes before their maturity in 2021, effective on Feb. 4.
Constellation Brands (STZ) had $500 million in total principal amount of the debt outstanding as of Jan. 5. The redemption price for the notes, payable in cash, will be calculated based on the formula in the supplemental indenture relating to the notes, including a make-whole premium of $4 million.
RBC Capital analyst Nik Modi this week reiterated a Buy rating and a price target of $262 (21% upside potential) on the stock ahead of the company’s 3Q earnings, which are scheduled to be released on Jan. 7.
Modi forecasted revenue growth of 16.4% in Q3 versus the Street consensus of 11.8%. The analyst expects the company to post EPS of $2.65, which is higher than analysts’ estimates of $2.56. (See STZ stock analysis on TipRanks)
Overall, the stock scores a cautiously optimistic outlook from the rest of the Street. The analyst consensus of a Moderate Buy is based on 9 Buys, 3 Holds and 1 Sell. The average price target of $229.85 implies 6% upside potential at current levels.
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