Name: Constellation Brands Inc. (NYSE:STZ) | Price to FCFE (P/FCFE)
Creator: Stock Analysis on Net

Free Cash Flow to Equity (FCFE)
P to FCFE Ratio, Current
P to FCFE Ratio, Historical

Constellation Brands Inc., FCFE calculation

US$ in thousands

12 months ended:	Feb 28, 2022	Feb 28, 2021	Feb 29, 2020	Feb 28, 2019	Feb 28, 2018	Feb 28, 2017
Net income (loss) attributable to CBI	(40,400)	1,998,000)	(11,800)	3,435,900)	2,318,900)	1,535,100)
Net income attributable to noncontrolling interests	41,400)	33,800)	33,200)	23,200)	11,900)	4,100)
Net noncash charges	2,890,000)	626,400)	2,613,400)	(975,300)	(71,200)	190,700)
Change in operating assets and liabilities, net of effects from purchase and sale of business	(185,600)	148,300)	(83,700)	(237,500)	(328,200)	(33,900)
Net cash provided by operating activities	2,705,400)	2,806,500)	2,551,100)	2,246,300)	1,931,400)	1,696,000)
Purchase of property, plant, and equipment	(1,026,800)	(864,600)	(726,500)	(886,300)	(1,057,600)	(907,400)
Proceeds from issuance of long-term debt	995,600)	1,194,700)	1,291,300)	3,657,600)	7,933,400)	1,965,600)
Principal payments of long-term debt	(1,365,300)	(2,721,300)	(2,195,300)	(62,800)	(7,128,700)	(971,800)
Net proceeds from (repayments of) short-term borrowings	323,000)	(238,900)	(552,600)	45,500)	137,200)	197,100)
Payments of debt issuance, debt extinguishment, and other financing costs	(34,600)	(22,300)	(8,200)	(34,600)	(122,200)	(14,100)
Free cash flow to equity (FCFE)	1,597,300)	154,100)	359,800)	4,965,700)	1,693,500)	1,965,400)

Based on: 10-K (reporting date: 2022-02-28), 10-K (reporting date: 2021-02-28), 10-K (reporting date: 2020-02-29), 10-K (reporting date: 2019-02-28), 10-K (reporting date: 2018-02-28), 10-K (reporting date: 2017-02-28).

An analysis of the financial performance from February 2017 to February 2022 reveals a significant divergence between the steady growth of operating cash flows and the high volatility of free cash flow to equity (FCFE).

Net Cash Provided by Operating Activities: A consistent upward trajectory is observed between 2017 and 2021, with annual cash flows increasing from 1.696 billion US$ to 2.807 billion US$. A marginal contraction occurred in 2022, with the figure settling at 2.705 billion US$, suggesting a stable and growing capacity to generate cash from core business operations.
Free Cash Flow to Equity (FCFE) Volatility: FCFE exhibited extreme fluctuations over the analyzed period. A substantial peak occurred in February 2019, reaching 4.966 billion US$, which significantly exceeded the operating cash flow for that year. This was followed by a precipitous decline in 2020 and 2021, with values dropping to 359.8 million US$ and 154.1 million US$, respectively. A recovery was evident in February 2022, as FCFE rose to 1.597 billion US$.
Analysis of Cash Flow Divergence: The marked difference between operating cash flows and FCFE indicates significant fluctuations in capital expenditures or net borrowing. The 2019 spike suggests a period of substantial financing inflows or divestitures. In contrast, the sharp decline in FCFE during 2020 and 2021, despite increasing operating cash flows, points toward a period of intensive capital investment or aggressive debt repayment, which restricted the cash available to equity shareholders.

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Constellation Brands Inc., current P/FCFE calculation, comparison to benchmarks

No. shares of common stock outstanding	184,550,904
Selected Financial Data (US$)
Free cash flow to equity (FCFE) (in thousands)	1,597,300)
FCFE per share	8.66
Current share price (P)	208.68
Valuation Ratio
P/FCFE	24.11
Benchmarks
P/FCFE, Competitors¹
Coca-Cola Co.	77.38
Mondelēz International Inc.	15.78
PepsiCo Inc.	16.28
Philip Morris International Inc.	25.39
P/FCFE, Sector
Food, Beverage & Tobacco	22.85
P/FCFE, Industry
Consumer Staples	41.33

Based on: 10-K (reporting date: 2022-02-28).

¹ Click competitor name to see calculations.

If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.

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Constellation Brands Inc., historical P/FCFE calculation, comparison to benchmarks

	Feb 28, 2022	Feb 28, 2021	Feb 29, 2020	Feb 28, 2019	Feb 28, 2018	Feb 28, 2017
No. shares of common stock outstanding¹	188,217,466	194,027,715	192,840,856	191,349,811	191,391,478	194,800,645
Selected Financial Data (US$)
Free cash flow to equity (FCFE) (in thousands)²	1,597,300)	154,100)	359,800)	4,965,700)	1,693,500)	1,965,400)
FCFE per share³	8.49	0.79	1.87	25.95	8.85	10.09
Share price^1, 4	254.21	238.31	153.02	207.48	228.26	171.06
Valuation Ratio
P/FCFE⁵	29.95	300.06	82.01	8.00	25.80	16.95
Benchmarks
P/FCFE, Competitors⁶
Coca-Cola Co.	29.91	23.29	—	—	—	—
Mondelēz International Inc.	14.10	30.57	—	—	—	—
PepsiCo Inc.	47.17	77.00	—	—	—	—
Philip Morris International Inc.	6.64	20.46	—	—	—	—
P/FCFE, Sector
Food, Beverage & Tobacco	16.95	29.54	—	—	—	—
P/FCFE, Industry
Consumer Staples	25.27	24.83	—	—	—	—

Based on: 10-K (reporting date: 2022-02-28), 10-K (reporting date: 2021-02-28), 10-K (reporting date: 2020-02-29), 10-K (reporting date: 2019-02-28), 10-K (reporting date: 2018-02-28), 10-K (reporting date: 2017-02-28).

¹ Data adjusted for splits and stock dividends.

² See details »

³ 2022 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= 1,597,300,000 ÷ 188,217,466 = 8.49

⁴ Closing price as at the filing date of Constellation Brands Inc. Annual Report.

⁵ 2022 Calculation
P/FCFE = Share price ÷ FCFE per share
= 254.21 ÷ 8.49 = 29.95

⁶ Click competitor name to see calculations.

The financial performance from February 2017 to February 2022 is characterized by significant volatility in cash flow generation and a subsequent extreme impact on valuation multiples. While the share price followed a general upward trajectory over the six-year period, the Free Cash Flow to Equity (FCFE) per share experienced dramatic fluctuations, leading to inconsistent P/FCFE ratios.

Share Price Evolution: The share price grew from 171.06 US$ in 2017 to 254.21 US$ in 2022. A notable contraction occurred in February 2020, with the price dropping to 153.02 US$, followed by a strong recovery in 2021 and 2022, where prices reached 238.31 US$ and 254.21 US$, respectively.
FCFE per Share Trends: FCFE per share demonstrated extreme instability. A significant peak occurred in February 2019 at 25.95 US$. This was followed by a severe decline, plummeting to 1.87 US$ in 2020 and reaching a period low of 0.79 US$ in 2021. A recovery was observed by February 2022, with the value rising to 8.49 US$.
P/FCFE Ratio Analysis: The P/FCFE ratio mirrored the instability of the cash flow metrics. In February 2019, the ratio reached a period low of 8.00, indicating a valuation highly supported by strong cash flow. In contrast, the ratio spiked to 82.01 in 2020 and reached an extreme peak of 300.06 in 2021. This surge highlights a period where the market valuation remained high despite a near-total collapse in FCFE per share. By February 2022, the ratio corrected to 29.95 as cash flow generation improved.

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Constellation Brands Inc. (NYSE:STZ)

Price to FCFE (P/FCFE)

Free Cash Flow to Equity (FCFE)

Price to FCFE Ratio, Current

Price to FCFE Ratio, Historical