J.P. Morgan Maintains Neutral on Constellation Brands

J.P. Morgan is out with its report today on Constellation Brands (NYSE: STZ), maintaining Neutral.

In a note to clients, J.P. Morgan writes, "We rate STZ Neutral at 10.6x consensus NTM estimates. Based on the current multiple and projected flat-to-LSD EPS growth, we think valuation is fair. Our price target for December 2011 is $21. This represents 11x our calendar 2012 estimate. At 11x, the company is trading at a 28% discount to the beverage group, above its 2-year 35% average. We think that is appropriate given the improvement in the wine category and STZ's trends."

Shares of STZ closed Thursday at $20.82, down 0.72% from Wednesday's close.