Tapping Into Constellation Brands' Growth, CEO Has Answers

Constellation Brands, Inc. (NYSE: STZ) came out with better-than-expected quarterly numbers on Thursday. Sales of the company rose 5 percent to $1.36 billion for the quarter, while EPS rose 34 percent to $1.06 year-over-year.

Constellation Brands CEO Rob Sands was on CNBC recently to discuss what's driving the growth of the company and why certain beer brands continue to do well.

Is Corona Driving All The Growth?

When asked about the popularity of Corona beer, Sands stated, "I'll tell you that's a large part of it, but it's really all about Corona, it's all about Modelo Especial – which is now the second largest imported beer brand in the United States and growing double digits – and it's about some of our spirits brands.

Related Link: Should You Add Craft Beer To Your Portfolio?

"We gained significant share in the spirits industry with brands like Svedka Vodka, and we have got some terrific wine brands that are also growing fast – Black Box, Dreaming Tree, just to name a couple."

Growth Of Hispanic Demographic

Sands was asked why the popularity of "Hispanic brew" brands like Corona and Modelo is growing. He replied, "I think there's two things going on. I think number one, there's a general drive to what we call better beers or more premium beers. Our portfolio has benefitted from that and the craft [craft brew] segment has benefitted from that."

He elaborated, "So, it's a general trend towards premiumization being driven by the consumer and that of course as it relates specifically to Hispanic; it's all about demographics. The Hispanic demographic is growing at probably the fastest rate of any demographic group in this country," Sands concluded.

 
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