The Smart Money Is Fond of These Five Alcohol Stocks

#3 Anheuser Busch Inbev SA (ADR) (NYSE:BUD)

– Number of Hedge Fund Holders (as of March 31): 32
– Total Value of Hedge Fund Holdings (as of March 31): $5.15 billion
– Hedge Fund Holdings as Percent of Float (as of March 31): 2.60%

Anheuser Busch Inbev SA (ADR) (NYSE:BUD)’s mega-merger with SAB Miller cleared another hurdle in May after the European Commission gave the thumbs up for the deal. Although Anheuser-Busch InBev divested some assets to get the European Commission’s blessing, the company will still be able to realize substantial synergies from the merger. 32 elite funds owned shares of the alcohol giant at the end of March, down four from that of the previous quarter. Anheuser currently pays an annual dividend of $3.97 per share, which gives its stock a 3% dividend yield.

#2 Molson Coors Brewing Company (NYSE:TAP)

– Number of Hedge Fund Holders (as of March 31): 52
– Total Value of Hedge Fund Holdings (as of March 31): $2.71 billion
– Hedge Fund Holdings as Percent of Float (as of March 31): 17.30%

With 52 funds from our database owning shares of at the end of the first quarter, Molson Coors Brewing Company (NYSE:TAP) is the second most popular alcohol stock on our list. Molson Coors reported better-than-expected first quarter results, with EPS of $0.54 on sales of $657.2 million, exceeding the consensus estimates by $0.11 per share and $31.33 million, respectively. Global beer volumes rose 1.2% year-over-year, while Coors Light volume rose 3.5% year-over-year. Although net sales shrank by 6.1% on a reported basis, they increased by 0.1% on a constant currency basis. The shares trade at a forward P/E of 19.7.

#1 Constellation Brands, Inc. (NYSE:STZ)

– Number of Hedge Fund Holders (as of March 31): 71
– Total Value of Hedge Fund Holdings (as of March 31): $5.43 billion
– Hedge Fund Holdings as Percent of Float (as of March 31): 18.00%

Analysts at Evercore ISI have a $190 price target on Constellation Brands, noting the company’s EBIT margins will likely trend higher in the intermediate future. Analysts at SunTrust are likewise bullish, with a ‘Buy’ rating and a $180 price target, which has been recently raised from $170. The smart money is bullish too, since 71 funds that we track owned shares of Constellation Brands, Inc. (NYSE:STZ) at the end of March, up from 67 at the end of 2015. Among the funds that added to their position in the first quarter include Dan Loeb’s Third Point, which raised its stake by 11% to 1.76 million shares. All the love from the smart money and analysts have helped Constellation’s stock rally 11% year-to-date.

Disclosure: none