Andrew Peller (TSX:ADW.A) is one of the premier Canadian wine makers.
Its shares have plunged 16% over the past three months as of close on January 27. The stock has dropped 24% year over year.
Domestic and globe wine markets have enjoyed impressive growth over the past decade, but Andrew Peller stock has struggled mightily since rising to all-time highs in the spring of 2018.
According to a recent report from Zion Market Research, the global wine market is expected to generate revenue of $423.59 billion U.S. in 2023. This would represent a compound annual growth rate (CAGR) of 5.8% between 2017 and 2023.
Will this translate to success for Andrew Peller? It released its second-quarter fiscal 2020 results on November 6. Sales were flat year-over-year and EBITDA increased to $35.7 million compared to $32 million in the prior year. Investors can expect to see its third-quarter report sometime in the month of February.
The board of directors increased its annual dividend on Class A shares 4.8% to $0.215 per share. This will be paid out quarterly at a $0.05375 per share clip. It represents a modest 1.9% yield.
Canadians are drinking more wine compared to a decade ago, and this trend is especially encouraging among younger demographics. Andrew Peller is carrying forward a strong balance sheet. The stock last had an RSI of 30, which puts it just outside of technically oversold territory. I like Andrew Peller as a pickup in late January.
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