Is Constellation Brands Making a Big Mistake?

Things weren't supposed to turn out this way for Constellation Brands (NYSE: STZ). The company's investment in Canopy Growth (NYSE: CGC) was intended to generate strong growth while diversifying the company's business.

Unfortunately, Constellation Brands has seen loss after loss from the cannabis producer pull down its results. While some growing pains were inevitable, there's not much light at the end of the tunnel. Investing in the cannabis industry has been an expensive $4 billion bet for Constellation Brands, one that the company may want to consider walking away from sooner rather than later.

Constellation Brands reported its third-quarter earnings earlier this month, which offered no surprises for investors: Canopy Growth dragged down the company's results, yet again. Although Constellation reported a profit of $366.5 million in Q3, the beer maker still incurred a loss of $71.1 million relating to its investment in the Canadian cannabis company.

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Source Fool.com