Morgan Stanley Issues Pessimistic Forecast for Constellation Brands (NYSE:STZ) Stock Price

Key Points

• Morgan Stanley cut Constellation Brands’ price target from $158 to $145 while maintaining an “equal weight” rating. The new target implies approximately 22.7% upside from the stock’s previous close.
• Constellation exceeded quarterly expectations, reporting adjusted EPS of $3.74 versus $3.62 expected and revenue of $2.63 billion, up 6.1% year over year.
• Beer demand remains a key risk: Modelo Especial and Corona Extra depletions declined, while analysts cited potential margin pressure and an uncertain turnaround. The stock has a consensus “Hold” rating with an average price target of $154.86.

Constellation Brands (NYSE:STZ - Get Free Report) had its target price decreased by Morgan Stanley from $158.00 to $145.00 in a research note issued to investors on Thursday, Benzinga reports. The firm currently has an "equal weight" rating on the stock. Morgan Stanley's target price would indicate a potential upside of 22.73% from the company's previous close.

STZ has been the topic of a number of other reports. Citigroup reissued a "negative" rating on shares of Constellation Brands in a research report on Wednesday. Deutsche Bank Aktiengesellschaft lowered their price objective on shares of Constellation Brands from $150.00 to $136.00 and set a "hold" rating for the company in a research report on Friday, September 11th. Evercore set a $160.00 target price on Constellation Brands in a report on Monday, September 21st. Jefferies Financial Group decreased their target price on Constellation Brands from $147.00 to $135.00 and set a "hold" rating for the company in a research note on Monday, September 14th. Finally, BMO Capital Markets restated an "outperform" rating and issued a $190.00 price target on shares of Constellation Brands in a report on Thursday, July 2nd. Eleven analysts have rated the stock with a Buy rating, eight have given a Hold rating and four have given a Sell rating to the company's stock. Based on data from MarketBeat.com, the company currently has a consensus rating of "Hold" and an average price target of $154.86.

Constellation Brands Stock Performance

Shares of NYSE:STZ opened at $118.15 on Thursday. The company has a market capitalization of $20.18 billion, a price-to-earnings ratio of 10.60, a P/E/G ratio of 2.30 and a beta of 0.44. The firm's 50 day simple moving average is $126.03 and its 200 day simple moving average is $138.41. The company has a debt-to-equity ratio of 1.06, a current ratio of 0.91 and a quick ratio of 0.48. Constellation Brands has a fifty-two week low of $110.60 and a fifty-two week high of $168.60.

Constellation Brands (NYSE:STZ - Get Free Report) last released its quarterly earnings data on Tuesday, October 6th. The company reported $3.74 earnings per share for the quarter, topping the consensus estimate of $3.62 by $0.12. The business had revenue of $2.63 billion for the quarter, compared to analyst estimates of $2.54 billion. Constellation Brands had a net margin of 19.57% and a return on equity of 25.17%. Constellation Brands's quarterly revenue was up 6.1% compared to the same quarter last year. During the same quarter last year, the firm earned $3.63 EPS. Constellation Brands has set its FY 2027 guidance at 11.200-11.900 EPS. As a group, sell-side analysts forecast that Constellation Brands will post 11.81 earnings per share for the current year.

Hedge Funds Weigh In On Constellation Brands

A number of institutional investors and hedge funds have recently added to or reduced their stakes in the stock. Ables Iannone Moore & Associates Inc. increased its stake in Constellation Brands by 105.2% in the 3rd quarter. Ables Iannone Moore & Associates Inc. now owns 16,904 shares of the company's stock valued at $1,911,000 after buying an additional 8,667 shares during the last quarter. Ally Financial Inc. acquired a new position in shares of Constellation Brands during the 2nd quarter worth about $1,600,000. Diamond Hill Capital Management LLC Investment Advisor bought a new position in shares of Constellation Brands in the 2nd quarter valued at about $31,582,000. Concurrent Investment Advisors LLC grew its holdings in shares of Constellation Brands by 1,613.6% in the 2nd quarter. Concurrent Investment Advisors LLC now owns 27,915 shares of the company's stock valued at $3,883,000 after acquiring an additional 26,286 shares in the last quarter. Finally, CORDA Investment Management LLC. increased its position in shares of Constellation Brands by 12.6% in the first quarter. CORDA Investment Management LLC. now owns 140,050 shares of the company's stock valued at $21,008,000 after acquiring an additional 15,694 shares during the last quarter. 77.34% of the stock is owned by institutional investors and hedge funds.

Trending Headlines about Constellation Brands

Here are the key news stories impacting Constellation Brands this week:

• Positive Sentiment: Q2 results exceeded expectations: Adjusted EPS was $3.74 versus the $3.62 consensus, while revenue increased 6.1% year over year to $2.63 billion, ahead of estimates. Beer sales rose 5%, and wine and spirits revenue jumped 17%. Corona beer maker Constellation Brands tops second-quarter estimates on resilient demand
• Positive Sentiment: Growth initiatives could broaden the portfolio: Constellation acquired spirit-based ready-to-drink brand SpikedAde for $75 million upfront, with up to $278 million in contingent payments, expanding its presence in the fast-growing RTD category. The company also highlighted improving trends in some channels and momentum for Pacifico, Victoria and Modelo Chelada. Constellation Brands Announces Acquisition of Spirit-Based Ready-to-Drink Brand SpikedAde
• Neutral Sentiment: Income support remains attractive: Constellation declared a quarterly dividend of $1.03 per share, equivalent to $4.12 annually and a yield of approximately 3.5%. Strong year-to-date free cash flow also supports shareholder returns, although the company’s balance-sheet liquidity remains relatively tight.
• Negative Sentiment: Beer demand remains the central concern: Modelo Especial depletions declined about 2% and Corona Extra declined about 5%. Analysts questioned whether recent improvement is durable as consumers become more price-sensitive and overall beer demand softens. Modelo owner Constellation is getting creative to bring back beer drinkers as overall demand weakens
• Negative Sentiment: Guidance and analyst caution pressured the stock: Fiscal 2027 EPS guidance of $11.20–$11.90 was viewed as less compelling relative to consensus near $11.74, while Morgan Stanley warned of second-half margin pressure. Goldman Sachs retained a Buy rating but cut its price target to $155, and Bank of America also reduced its target because the beer turnaround remains unproven. Constellation Brands PT Lowered to $155 at Goldman Sachs

About Constellation Brands

Constellation Brands, Inc is a beverage alcohol company that develops, markets and distributes beer, wine and spirits. Its portfolio includes well-known beer brands such as Modelo Especial, Corona Extra, Corona Light and Pacifico, along with wine brands including Robert Mondavi, Kim Crawford, Meiomi, The Prisoner Wine Company and Ruffino.

The company also offers spirits through brands such as Casa Noble tequila and High West whiskey. Constellation's products are sold through retailers, distributors, restaurants and other on-premise locations, with a primary focus on the United States.

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