Thursday, October 06, 2011

Donald Trump Getting into the Wine Industry: Should You?

Billionaire Donald Trump, who made most of his wealth from real estate, has recently purchased a 770 acre Charlottesville, Virginia winery for $8 million. This purchase is expected to help the local and state economy, as Virginia has the fifth largest wine industry in the United States.

So as an investor, suppose you want to get into the wine or liquor industry? You have over a dozen stocks to choose from according to the free list of wine and liquor stocks at One of these companies is the dividend paying Diageo plc Common Stock (DEO), which sports a fairly high yield of 4.3%. This London based company has numerous alcohol brands including Johnnie Walker, Smirnoff, Baileys Original Irish Cream, Crown Royal, Captain Morgan, Jose Cuervo, Ketel One, Ciroc, Tanqueray, Bushmills, Guinness, Gordon's, Seagram's 7, and Red Stripe. The company's wine brands include Blossom Hill, Sterling Vineyards, Beaulieu Vineyard, Navarro Correas, Acacia Vineyard, Chalone Vineyard, and Santa Rita.

The stock trades at 16 times current earnings and 12 times forward earnings. It has a price to earnings growth ratio of 1.25. Earnings for the latest reported quarter were up 15% on flat revenues.

Another liquor distributor is Constellation Brands Inc. (STZ) just reported that its second-quarter earnings spiked up by 78 percent due to improved North American sales of liquor and wine. The stock trades at 9.5 times forward earnings and has a PEG ratio of 1.08. The wine brands include Robert Mondavi, Clos du Bois, Blackstone, Estancia, Arbor Mist, Toasted Head, Ravenswood, Franciscan Estate, Wild Horse, Ruffino, and Jackson-Triggs. The spirit brands include Black Velvet Canadian Whisky, SVEDKA Vodka, and Paul Masson Grande Amber Brandy.

To see all the stocks in the liquor and wine industry, check out the list at, which can be downloaded, sorted and updated.

Full disclosure: Author did not own any of the above at the time the article was written.


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