Truist analyst Bill Chappell upgraded Constellation Brands (STZ) to Buy from Hold with a price target of $215, up from $190. The firm says investor cynicism on alcohol consumption is too high and investor sentiment on Constellation has bottomed. The company’s free cash flow is underappreciated by investors at the current valuation, the analyst tells investors in a research note. Truist believes the overall U.S. demand for alcohol normalized last year based on U.S. retail alcohol sales coming back in-line with their pre-COVID trend. Americans are not abandoning alcohol for other vices or abstinence, the firm contends.
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