if there ever were a perfect m&a case study, it just might be the shining star at constellation brands inc. the alcoholic-beverages company, which started as a bulk wine purveyor in the 1940s , has transformed itself into a beer powerhouse thanks to a key acquisition three years ago. constellation<u+2019>s market value has since more than tripled, with the good times expected to keep rolling in its fiscal second-quarter results, out<u+00a0>wednesday. analysts polled by factset expect earnings of $1.65 a share for the period ended in august, up 6% from a year ago. revenue is expected to have risen 13% to $1.96 billion. analysts anticipate double-digit earnings growth in each of the next five years. constellation acquired the u.s. distribution rights to corona and modelo in 2013 , benefiting by being in the right place at the right time as anheuser-busch inbev nv bought the half of mexican partner grupo modelo it didn<u+2019>t already own. the price of regulatory approval was the sale of modelo<u+2019>s u.s. business and a new mexican brewery to its joint-venture partner, constellation unit crown imports. constellation, now the third-largest u.s. beer seller, owns five of the u.s.<u+2019>s top 15 most popular imported beers. overall, beer makes up about two-thirds of constellation<u+2019>s operating income and more than half of its revenue. analysts expect both percentages to keep increasing in the coming years, bucking an industry trend of slower growth in noncraft beer. get financial insights and commentary on global investing from the wall street journal<u+2019>s heard on the street team. subscribe to the podcast. constellation isn<u+2019>t sitting still, either. last week constellation put its canadian wine business on the block and on tuesday news emerged that it bid for a u.s. whiskey business. the auction, which could fetch more than $1 billion, is part of constellation<u+2019>s continued effort to focus on premium wines and beer in the u.s. granted, there are concerns. at least one analyst already has warned about how a donald trump presidency could affect imports and damage relationships with mexico , all potentially hurting constellation. constellation shareholders don<u+2019>t seem too perturbed about next month<u+2019>s election, with the stock up about 17% so far this year. shares fetch 24 times projected earnings, up from 18 times in the summer of 2013. but with earnings per share expected to more than double over the next five years, that rich multiple seems justified. this premium brew isn<u+2019>t too frothy just yet. write to steven russolillo at steven.russolillo@wsj.com
constellation brands<u+2019> party rolls on    - wsj
steven russolillo