Weekly "Focus" and Three Constellations

Bradley Goldhar - Jan 17, 2025

A constellation is a group of stars that form a recognizable pattern in the sky and there are 88 official constellations recognized by the International Astronomical Union. Constellation is also the name of three prominent public companies in Canada and the US:

 

  • Constellation Brands is one of the world’s largest alcoholic drinks companies distributing brands such as Corona, Modelo and Robert Mondavi wines.

  • Constellation Energy is a major US utility generating electricity through natural gas, nuclear and renewable energy sources such as hydro, solar and wind.

  • Constellation Software is a Canadian multi-national company that acquires, builds, and manages vertical software companies (software that is focused on a particular industry or “vertical”).

 

Both Constellation Brands and Constellation Energy were in the news last week, with their share prices going in different directions. Constellation Brands reported weaker than expected quarterly results sending the shares tumbling 17%. On the other hand, the shares of Constellation Energy jumped 20% on the $16.4 billion acquisition of privately held Calpine, the largest generator of electricity through natural gas in the US. Constellation Software also announced the acquisition of a UK-based property management software company for an undisclosed amount and will report its quarterly results on February 6th.

 

 

Price Return

2025

Price Return 2024

Dividend

Yield

Constellation Brands (STZ-US)

-16.5%

-8.6%

2.2%

Constellation Energy (CEG-US)

+40.9%

+91.4%

0.4%

Constellation Software (CSU-CA)

-1.0%

+35.3%

0.1%

Source: FactSet, Values as of January 16, 2025

 

This week’s "Focus" from our economics team is attached.

 

Have a great weekend,

 

Brad

Senior Portfolio Manager and Senior Investment Advisor