wine production hasn't been this low since before 1970.
One reason why the consumption of wine is increasing is that studies have shown that red wine may help prevent memory loss and even reduce the effects of Alzheimer's, primarily due to the resveratrol. Red wine has a much higher concentration of resveratrolthan other foods such as peanuts and tomatoes.
There are several companies involved in the production and distribution of wine, but in many cases, it is not the major portion of the business. Based on the free list at
WallStreetNewsNetwork.com, there are over twelve stocks that distribute
wine and liquor, two of which pay dividends. Constellation Brands (STZ) makes and sells table wines, sparkling wines and dessert wines. The stock trades at 7.4 times trailing earnings and 18.5 times forward earnings.
The largest is Diageo (DEO), an alcoholic
beverage distributor which sells many brands of wine, including Blossom
Hill, Sterling Vineyards, Beaulieu Vineyard, Navarro Correas, Acacia
Vineyard, Rosenblum Cellars, Piat d'Or, Chalone Vineyard, and Santa
Rita. The stock trades at 20.5 times trailing earnings and 17.2 times forward earnings. It pays a yield of 2.9%.
Brown-Forman Corporation (BF-B) is another liquor
distributor which is most known for its Jack Daniel's and Southern
Comfort brands. It also sells the Sonoma-Cutrer brand of wines and
Corbel California Champaigne. The stock has a forward price-to-earnings
ratio of 23.1, an improvement over its trailing PE of 27.6. The company pays a yield of 1.6%. Latest quarterly earnings were down 2.7%
on 3% increase in revenues.
If you are looking for more of a pure play, there is a small one
based in Turner, Oregon, Willamette Valley Vineyards Inc. (WVVI), which
produces and markets Syrah, Merlot, Cabernet Sauvignon, Cabernet Franc,
The Griffin, and Viognier under the Griffin Creek label. The stock
trades at 18 times earnings, but does not pay a dividend.
Treasury Wine Estates (TSRYF), which tradee at 71.8 times earnings, distributes the Berenger and Chateau St. Jean wine brands.
For a free list of all the other wine and liquor stocks, which can be downloaded, sorted and updated, go to WallStreetNewsNetwork.com.
Disclosure: Author did not own any of the above at the time the article was written.