Why Treasury Wine Estates’ Share Price Rebounds 3.75%

After finishing almost 5% lower yesterday, Treasury Wine Estates Limited [ASX:TWE] has rebounded 4.037% today, or $0.575, and is currently trading at $14.82 per share.

What’s happened to Treasury Wine Estates’ share price?

Investors were quick to sell TWE yesterday morning after one of its rivals had released a disappointing trading update in the US.

Constellation Brands’ share price fell 12% after news of weak third quarter wine sales reached investors.

Investors appeared to believe TWE may also fall short of FY19 expectations, which put the share price into a nosedive.

Special 2019 report: The next generation of Aussie income super stars revealed. Hint: it’s not the banks. Click here to claim your copy now.

After trading closed yesterday, Treasury Wine Estates sought to alleviate any concerns about the company’s underperformance. In the announcement, TWC made assurances it was happy with trading performances across its operating regions and expects earnings above consensus estimates.

The current consensus EBITS is $332 million, with the company now forecasting EBITS within the range of $335 million to $340 million. TWE has given guidance of approximately 25% reported EBITS growth for fiscal 2019.

What’s next for Treasury Wine Estates

With its audited results for the first six months of fiscal 2019 due on 14 February 2019, TWE is on track to report an increase in total earnings.

However, despite the strong momentum in the wine market exhibited in China, Citibank suspects that the company’s sales will slow beyond FY19.

More to come.

Regards,

Ryan Clarkson-Ledward,
For Money Morning

PS: The growing Chinese middle class could translate into a massive investment opportunity for Australians. Get the details here.


Ryan Clarkson-Ledward is one of Money Morning’s junior analysts. Ryan holds degrees in both communication and international business. He helps bring Money Morning readers the latest market updates, both locally and abroad. Ryan tackles all the issues investors need to know about that the mainstream media neglects. Ryan’s primary focus is assisting Sam Volkering with background research and insight for readers by dissecting the latest events affecting the world. Working closely with Sam, they explore the latest in small-cap and technology stocks as well as cryptocurrency opportunities. You can find Ryan’s contributing research, developments, and supporting information across several e-letters, including:


Leave a Reply

Your email address will not be published. Required fields are marked *

Money Morning Australia