Constellation Brands (STZ) AI Stock Analysis

• Market Cap: $27.92B
• Dividend Yield: 2.53%
• Average Volume (3M): 1.79M
• Price to Earnings (P/E): 49.1
• Beta (1Y): 0.46
• Revenue Growth: -0.47%
• EPS Growth: -117.62%
• Country: US
• Employees: 10,600
• Sector: Consumer Defensive
• Sector Strength: 46
• Industry: Beverages - Wineries & Distilleries
• EPS (TTM): 3.22
• Shares Outstanding: 176,266,240
• 10 Day Avg. Volume: 2,055,841
• 30 Day Avg. Volume: 1,787,893
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.56
• Enterprise Value/Revenue: 4.32
• Enterprise Value/Gross Profit: 8.47
• Enterprise Value/Ebitda: 95.05
• 1Y Price Target: $200.18
• Price Target Upside: 24.72% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 18

• Rating: 62 Neutral
• Price Target: $174.00 ▲(8.41% Upside)

Constellation Brands' overall stock score reflects a mix of strengths and challenges. Strong cash flow and operational efficiency are offset by profitability pressures and valuation challenges. The technical indicators suggest bearish momentum, while the earnings call and corporate events provide a cautiously optimistic outlook. The company's strategic focus on high-margin segments and shareholder returns is positive, but economic and consumer challenges remain significant.

Positive Factors

Capital Return

Strong cash flow generation and capital return in the form of share buybacks could offset operating income pressure.

Distribution Expansion

Clear progress toward the 2023 Analyst Day distribution targets, with more than half of the five-year 500K distribution point opportunity already secured.

Growth Strategy

Constellation has a path to offset economic pressure on its base of Hispanic consumers by continuing to expand beer distribution and extending into more pack sizes and price points.

Negative Factors

Aluminum Tariffs

Potential cost pressures from aluminum tariffs and possible increase in promotions could impact beer margins.

Guidance Cuts

A negative 30-day catalyst watch has been opened due to anticipated guidance cuts in the beer business.

Hispanic Consumer Softness

There is potential risk to the beer topline outlook as STZ beer trends remain very soft and there are concerns the Hispanic consumer softness may linger.

Constellation Brands Business Overview & Revenue Model

Company Description

Constellation Brands, Inc., together with its subsidiaries, produces, imports, markets, and sells beer, wine, and spirits in the United States, Canada, Mexico, New Zealand, and Italy. It provides beer primarily under the Corona Extra, Corona Premier, Corona Familiar, Corona Light, Corona Refresca, Corona Hard Seltzer, Modelo Especial, Modelo Negra, Modelo Chelada, Pacifico, and Victoria brands. The company offers wine under the 7 Moons, Cook's California Champagne, Cooper & Thief, Crafters Union, Kim Crawford, Meiomi, Mount Veeder, Ruffino, SIMI, The Dreaming Tree, Charles Smith, The Prisoner Wine Company, Robert Mondavi, My Favorite Neighbor, and Schrader; and spirits under the Casa Noble, Copper & Kings, High West, Mi CAMPO, Nelson's Green Brier, and SVEDKA brands. It provides its products to wholesale distributors, retailers, on-premise locations, and state alcohol beverage control agencies. Constellation Brands, Inc. was founded in 1945 and is headquartered in Victor, New York.

How the Company Makes Money

Constellation Brands generates revenue primarily through the sale of its alcoholic beverages across various categories. The Beer segment, which constitutes a significant portion of the company's earnings, includes popular brands that are distributed across the United States and internationally. The Wine & Spirits segment also contributes to revenue through the sale of premium wines and spirits, often leveraging brand recognition and quality to command higher price points. The company benefits from strategic partnerships with distributors and retailers, which enhance its market reach and efficiency in supply chain management. Additionally, Constellation Brands invests in marketing and brand development to drive consumer demand, while also exploring opportunities in emerging markets and new product lines to diversify its revenue streams. Factors such as changing consumer preferences towards premium and craft beverages, as well as the company's focus on innovation and sustainability, further contribute to its financial performance.

Constellation Brands Financial Statement Overview

Summary

Constellation Brands shows strong operational efficiency with a high gross profit margin and robust cash flow generation. However, profitability is under pressure due to a negative net income, impacting ROE and increasing financial risks. The balance sheet is stable but constrained by moderate leverage.

Income Statement

Constellation Brands shows a strong Gross Profit Margin at 51.5% for TTM, indicating effective cost management. However, the Net Profit Margin is negative due to a net income loss of $442.3 million in TTM, reflecting challenges in profitability. The revenue growth rate shows a slight decline from the previous year, indicating stable yet stagnant revenue performance. Despite the positive EBIT and EBITDA margins, the negative net income impacts the overall performance.

Balance Sheet

The company's Debt-to-Equity Ratio is 1.59 for TTM, pointing to a moderate level of financial leverage. Return on Equity is negative due to the net loss, raising concerns about shareholder value creation. The Equity Ratio is 32.6%, showing a solid equity base but highlighting potential risks related to high debt levels. Overall, the balance sheet exhibits stability but is constrained by leverage and negative earnings.

Cash Flow

Operating Cash Flow remains robust at $3.1 billion in TTM, and the Free Cash Flow is positive, reflecting strong cash generation capability. The Free Cash Flow to Net Income ratio is favorable due to cash flow strengths, despite the net income loss. However, the Free Cash Flow Growth Rate is moderate, influenced by steady capital expenditures. Overall, cash flow performance is strong and provides a cushion against operational challenges.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	10.06B	10.21B	9.96B	9.45B	8.82B	8.61B
Gross Profit	5.14B	5.20B	4.91B	4.81B	4.60B	4.47B
EBITDA	457.60M	782.60M	3.08B	1.17B	1.00B	3.22B
Net Income	-442.30M	-81.40M	1.73B	-71.00M	-40.40M	2.00B
Balance Sheet
Total Assets	22.26B	21.65B	25.69B	24.66B	25.86B	27.10B
Cash, Cash Equivalents and Short-Term Investments	73.90M	68.10M	152.40M	133.50M	199.40M	460.60M
Total Debt	11.57B	12.11B	12.56B	12.96B	10.95B	10.98B
Total Liabilities	14.73B	14.52B	15.63B	15.93B	13.81B	13.18B
Stockholders Equity	7.27B	6.88B	9.74B	8.41B	11.73B	13.60B
Cash Flow
Free Cash Flow	2.07B	1.94B	1.51B	1.72B	1.68B	1.94B
Operating Cash Flow	3.10B	3.15B	2.78B	2.76B	2.71B	2.81B
Investing Cash Flow	-793.50M	-974.80M	-1.29B	-999.40M	-1.04B	-87.90M
Financing Cash Flow	-2.31B	-2.26B	-1.47B	-1.82B	-1.93B	-2.35B

Constellation Brands Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 160.50
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STZ, the sentiment is Negative. The current price of 160.5 is below the 20-day moving average (MA) of 167.37, below the 50-day MA of 167.50, and below the 200-day MA of 186.32, indicating a bearish trend. The MACD of -2.12 indicates Positive momentum. The RSI at 38.36 is Neutral, neither overbought nor oversold. The STOCH value of 23.90 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for STZ.

Constellation Brands Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ABEV	73 Outperform	$35.33B	13.42	15.08%	2.05%	-0.79%	-10.83%
BF.B	70 Outperform	$14.14B	16.89	23.14%	2.95%	-4.90%	-14.49%
BF.A	69 Neutral	$14.14B	16.98	23.14%	2.92%	-4.90%	-14.49%
DEO	68 Neutral	$61.67B	26.69	22.33%	3.69%	0.22%	-38.76%
TAP	68 Neutral	$9.97B	10.16	7.79%	3.56%	-5.48%	-6.99%
Sector *	63 Neutral	$20.46B	14.47	-3.60%	3.13%	2.63%	-6.18%
STZ	62 Neutral	$27.92B	49.10	-5.05%	2.53%	-0.47%	-117.62%

Constellation Brands Corporate Events

Constellation Brands Approves Equity Grants for CFO

On July 15, 2025, Constellation Brands‘ Board of Directors approved equity grants for CFO Garth Hankinson, recognizing his leadership in the company’s cost-savings agenda. The grants, comprising restricted stock units and performance share units, are set to vest by May 1, 2028, contingent on his continued service and certain performance metrics. Additionally, the company’s virtual Annual Meeting on the same day resulted in the election of 12 directors for a one-year term and the ratification of KPMG LLP as the independent registered public accounting firm for the fiscal year ending February 28, 2026. Stockholders also approved the compensation of the company’s named executive officers.

Constellation Brands Announces Quarterly Cash Dividend

On July 1, 2025, Constellation Brands announced a quarterly cash dividend for its shareholders, reflecting its commitment to returning value to investors. Despite facing socioeconomic challenges affecting consumer demand, the company reported strong performance in its beer business, leading the U.S. market in dollar share gains. The wine and spirits segment saw a decline in sales following the divestiture of mainstream wine brands, but the company remains focused on high-margin segments. Constellation Brands also repurchased $381 million in shares and maintained its fiscal 2026 financial outlook, emphasizing strategic capital allocation and investment in brewery capacity.

Constellation Brands Completes Wine Brands Sale to The Wine Group

On June 2, 2025, Constellation Brands announced the completion of its sale and exclusive licensing of certain mainstream wine brands and associated assets to The Wine Group, as part of a strategic move to focus on higher-growth, higher-margin brands. Additionally, Constellation Brands declared the full redemption of its outstanding 4.75% Senior Notes due 2025 and 5.00% Senior Notes due 2026, signaling a shift towards premiumization trends and improved performance in its wine and spirits segment.