Strategic Winery Tourism and Management

Financial Ratio and Valuation Analyses of Constellation Brands Inc 259

we calculated growth rate of the industry, g = 13.83%, as the arithmetic

average of the results from the following two methods:

Method 1: g

INDUSTRY

= (g

DEO

+ g

BF-B

)/2 = (10.03% + 6.11%)/2 = 8.07%

where g

DEO

= 10.03% and g

BF-B

= 6.11%. The g

DEO

and g

BF-B

are found as

geometric averages of quarterly growth rates from the historical dividend

data for the 3/3/2008 – 9/3/2013 period. Subsequently, the quarterly geo-

metric average growth rates are converted to annual geometric average

growth rates by using: g

ANNUAL

= (1+ g

QUARTERLY

)

4

– 1 = g

DEO (ANNUAL)

= (1+

0.0242)

4

– 1 = 10