Contrasting Molson Coors Beverage (NYSE:TAP) & Constellation Brands (NYSE:STZ)

Molson Coors Beverage (NYSE:TAP) and Constellation Brands (NYSE:STZ) are both consumer staples companies, but which is the better business? We will contrast the two companies based on the strength of their dividends, analyst recommendations, earnings, risk, institutional ownership, valuation and profitability.

Institutional and Insider Ownership

78.5% of Molson Coors Beverage shares are held by institutional investors. Comparatively, 77.3% of Constellation Brands shares are held by institutional investors. 2.7% of Molson Coors Beverage shares are held by company insiders. Comparatively, 12.5% of Constellation Brands shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Dividends

Molson Coors Beverage pays an annual dividend of $1.88 per share and has a dividend yield of 4.0%. Constellation Brands pays an annual dividend of $4.08 per share and has a dividend yield of 3.0%. Molson Coors Beverage pays out 37.1% of its earnings in the form of a dividend. Constellation Brands pays out -170.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Molson Coors Beverage has increased its dividend for 4 consecutive years and Constellation Brands has increased its dividend for 5 consecutive years.

Risk & Volatility

Molson Coors Beverage has a beta of 0.69, indicating that its stock price is 31% less volatile than the S&P 500. Comparatively, Constellation Brands has a beta of 0.67, indicating that its stock price is 33% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations for Molson Coors Beverage and Constellation Brands, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Molson Coors Beverage	1	9	6	0	2.31
Constellation Brands	4	9	13	1	2.41

Molson Coors Beverage presently has a consensus target price of $58.18, indicating a potential upside of 22.72%. Constellation Brands has a consensus target price of $192.28, indicating a potential upside of 42.98%. Given Constellation Brands’ stronger consensus rating and higher possible upside, analysts clearly believe Constellation Brands is more favorable than Molson Coors Beverage.

Profitability

This table compares Molson Coors Beverage and Constellation Brands’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Molson Coors Beverage	7.81%	8.61%	4.39%
Constellation Brands	-4.11%	31.41%	10.81%

Valuation & Earnings

This table compares Molson Coors Beverage and Constellation Brands”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Molson Coors Beverage	$13.73 billion	0.68	$1.12 billion	$5.07	9.35
Constellation Brands	$10.96 billion	2.16	-$81.40 million	($2.39)	-56.27

Molson Coors Beverage has higher revenue and earnings than Constellation Brands. Constellation Brands is trading at a lower price-to-earnings ratio than Molson Coors Beverage, indicating that it is currently the more affordable of the two stocks.

Summary

Constellation Brands beats Molson Coors Beverage on 10 of the 18 factors compared between the two stocks.

About Molson Coors Beverage

Molson Coors Beverage Company manufactures, markets, and sells beer and other malt beverage products under various brands in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company offers flavored malt beverages including hard seltzers, craft, spirits and energy, and ready to drink beverages. It provides its products under Aspall Cider, Blue Moon, Coors Original, Five Trail, Hop Valley brands, Leinenkugel’s, Madri, Miller Genuine Draft, Molson Ultra, Sharp’s, Staropramen, and Vizzy Hard Seltzer above premier brands; Bergenbier, Borsodi, Carling, Coors Banquet, Coors Light, Jelen, Kamenitza, Miller Lite, Molson Canadian, and Niksicko, Ozujsko under the premium brands; and Branik, Icehouse, Keystone, Miller High Life, Milwaukee’s Best, and Steel Reserve under the economy brands. The company was formerly known as Molson Coors Brewing Company and changed its name to Molson Coors Beverage Company in January 2020. Molson Coors Beverage Company was founded in 1774 and is based in Golden, Colorado.

About Constellation Brands

Constellation Brands, Inc., together with its subsidiaries, produces, imports, markets, and sells beer, wine, and spirits in the United States, Canada, Mexico, New Zealand, and Italy. The company provides beer primarily under the Corona Extra, Corona Familiar, Corona Hard Seltzer, Corona Light, Corona Non-Alcoholic, Corona Premier, Corona Refresca, Modelo Especial, Modelo Chelada, Modelo Negra, Modelo Oro, Victoria, Vicky Chamoy, and Pacifico brands. It also offers wine under the Cook’s California Champagne, Kim Crawford, Meiomi, Mount Veeder, Ruffino, SIMI, My Favorite Neighbor, Robert Mondavi Winery, Schrader, and The Prisoner Wine Company brands; and spirits under the Casa Noble, Copper & Kings, High West, Mi CAMPO, Nelson’s Green Brier, and SVEDKA brands. The company provides its products to wholesale distributors, retailers, on-premise locations, and state alcohol beverage control agencies. Constellation Brands, Inc. was founded in 1945 and is headquartered in Victor, New York.