Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio.
CORONA WEATHER HOUR FULL
See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. (Jim Cramer's Charitable Trust is long STZ. And so hot says that Constellation is going to do very well," Cramer said, pointing out that there's for more room for growth in beer as people move away from drinking hard seltzers. "Hot is the way to judge whether they're doing well, not price. "It's been hot in the country as well," which means people drink more and Corona, Modelo and Pacifico are summertime beers. "The secret behind the Mexican bar is the heat," Cramer explained, drawing on his previous ownership of Bar San Miguel in Brooklyn, New York. "There is a sense that there's a rebellion against premiumization, and people are buying cheaper beer," While cheaper beer does better during economic hardship, the hot weather in the summer months is an overriding factor and major catalyst for beverage selling.
CORONA WEATHER HOUR DRIVERS
Key drivers In Monday's "Morning Meeting," Cramer cleared up what he considers a misconception about beer sales in a slowing economy and explained the real driver behind Constellation's beer sales growth. Against this positive backdrop, Morgan Stanley reiterated its overweight (buy) rating on STZ with a price target of $298 per share, a 16% premium to its current price of around $255. This indicates consumers still want premium beer as an affordable indulgence even as inflation worries impact spending in other areas. The note also signaled that Constellation's high-end products can hold up even as consumers trade down to cheaper alternatives due to its "strong momentum at key brands" of Mexican beers. We are raising F2Q EPS from $3.09 to $3.15 vs the $2.95 consensus, and our FY23 estimate from $11.70 to $11.80 vs the $11.54 consensus. To that end, here's Morgan Stanley's thoughts on earnings per share estimates. In the beverage industry, depletions measure cases that distributors sell to retailers. The current market consensus is closed to 9% in beer depletions. Analysts' take In their research note, Morgan Stanley analysts forecasted fiscal second quarter beer depletions of 10.5%, saying they see their estimate as "conservative" compared to 9% previously. What's more is Constellation shares have has been outperforming the broader market with a 1.5% year-to-date gain compared to the S & P 500 's 13% drop in 2022 - an indication that confidence in consumer demand for the company's products overrides fears of higher prices in nearly everything nowadays.
"They have 100% of the growth of beer," Jim Cramer said in the Investing Club's "Morning Meeting" on Monday, highlighting the company as a top competitor in its category. The Club's stake The recession-resistant nature of Constellation's Mexican beers - Corona, Modelo and Pacifico - has been at the core of why we like this stock so much, especially during these uncertain times of spiking inflation and slowing economic growth. Shares of Constellation Brands rose about 1% in Monday's terrible overall market after Morgan Stanley raised its earnings-per-share estimates on accelerating momentum in beer sales.
Constellation Brands (STZ) has finally received the kind of recognition on Wall Street that's been key to the Club's investment thesis since we initiated the the beer, wine and spirits stock back in May.
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