Winemaker adds whisky to its lineup

Article Excerpt

ANDREW PELLER LTD. (Toronto symbols ADW.A $12 and ADW.B $12; Income Portfolio, Consumer sector; Shares outstanding: 42.6 million; Market cap: $511.2 million; Price-to-sales ratio: 1.4; Dividend yield: 1.4%; TSINetwork Rating: Above Average; www.andrewpeller.com) is Canada’s second-largest wine producer. In 2011, the company formed a strategic alliance with hockey star Wayne Gretzky’s winery in Niagara-on-the-Lake, Ontario. The wines they produce are now among the top 10 selling brands in Canada. Peller and Gretzky aim to expand on this success with the recent launch of Wayne Gretzky No. 99 Red Cask Canadian Whisky. This new product should help boost the company’s earnings by 30% in the fiscal year ending March 31, 2017, to $0.60 a share. The stock trades at a reasonable 20.0 times that estimate. As well, Peller has paid dividends since 1979, and it has increased the rate seven times in the past 10 years. The current annual rate of $0.163 a share yields 1.4%. Andrew Peller is a buy. buy…