Constellation Brands (NYSE:STZ) Lowered to Hold Rating by Freedom Capital

Key Points

• Constellation Brands was downgraded by Freedom Capital from strong-buy to hold, adding to a broader wave of more cautious analyst sentiment on the stock.
• Several other firms recently trimmed their price targets, and the current consensus view on STZ is now Hold with an average target price of $167.89.
• The company reported mixed quarterly results, missing EPS estimates but slightly beating revenue expectations; shares were trading around $137.36, well below the stock’s recent highs.

Constellation Brands (NYSE:STZ - Get Free Report) was downgraded by equities researchers at Freedom Capital from a "strong-buy" rating to a "hold" rating in a research report issued to clients and investors on Wednesday,Zacks.com reports.

A number of other equities analysts also recently commented on STZ. Barclays decreased their target price on Constellation Brands from $170.00 to $139.00 and set an "equal weight" rating for the company in a research note on Thursday. Piper Sandler reissued a "neutral" rating and issued a $160.00 price target on shares of Constellation Brands in a report on Wednesday. JPMorgan Chase & Co. reduced their price objective on Constellation Brands from $169.00 to $165.00 and set a "neutral" rating for the company in a research report on Thursday. Royal Bank Of Canada restated an "outperform" rating and set a $185.00 price objective on shares of Constellation Brands in a research note on Thursday. Finally, Jefferies Financial Group set a $147.00 target price on Constellation Brands in a research report on Thursday. One equities research analyst has rated the stock with a Strong Buy rating, eleven have issued a Buy rating, nine have given a Hold rating and two have issued a Sell rating to the company's stock. Based on data from MarketBeat, Constellation Brands currently has an average rating of "Hold" and a consensus target price of $167.89.

Constellation Brands Stock Up 0.3%

Shares of NYSE:STZ opened at $137.36 on Wednesday. The company's fifty day moving average is $145.07 and its two-hundred day moving average is $150.09. The company has a debt-to-equity ratio of 1.06, a quick ratio of 0.55 and a current ratio of 0.91. Constellation Brands has a 1-year low of $126.45 and a 1-year high of $178.13. The stock has a market capitalization of $23.65 billion, a price-to-earnings ratio of 13.11, a price-to-earnings-growth ratio of 4.08 and a beta of 0.39.

Constellation Brands (NYSE:STZ - Get Free Report) last posted its quarterly earnings results on Tuesday, June 30th. The company reported $3.43 EPS for the quarter, missing the consensus estimate of $3.72 by ($0.29). The business had revenue of $2.43 billion during the quarter, compared to analyst estimates of $2.39 billion. Constellation Brands had a net margin of 18.87% and a return on equity of 25.58%. The company's quarterly revenue was down 3.3% on a year-over-year basis. During the same period last year, the firm posted $3.22 earnings per share. Constellation Brands has set its FY 2027 guidance at 11.200-11.900 EPS. Equities analysts anticipate that Constellation Brands will post 11.64 EPS for the current year.

Insider Transactions at Constellation Brands

In other Constellation Brands news, EVP James O. Bourdeau sold 4,407 shares of the business's stock in a transaction on Tuesday, May 12th. The stock was sold at an average price of $143.24, for a total transaction of $631,258.68. Following the completion of the transaction, the executive vice president owned 9,109 shares in the company, valued at approximately $1,304,773.16. The trade was a 32.61% decrease in their position. The sale was disclosed in a legal filing with the SEC, which can be accessed through this link. Company insiders own 12.20% of the company's stock.

Institutional Inflows and Outflows

A number of large investors have recently modified their holdings of STZ. Brighton Jones LLC boosted its holdings in shares of Constellation Brands by 23.0% in the fourth quarter. Brighton Jones LLC now owns 1,001 shares of the company's stock valued at $221,000 after acquiring an additional 187 shares in the last quarter. Woodline Partners LP bought a new stake in Constellation Brands during the first quarter worth approximately $2,409,000. Cary Street Partners Financial LLC raised its holdings in Constellation Brands by 69.9% during the second quarter. Cary Street Partners Financial LLC now owns 1,026 shares of the company's stock worth $167,000 after purchasing an additional 422 shares in the last quarter. Bank of Nova Scotia lifted its position in Constellation Brands by 3.6% in the second quarter. Bank of Nova Scotia now owns 17,347 shares of the company's stock worth $2,822,000 after purchasing an additional 599 shares during the period. Finally, Daiwa Securities Group Inc. lifted its position in Constellation Brands by 5.0% in the second quarter. Daiwa Securities Group Inc. now owns 23,732 shares of the company's stock worth $3,861,000 after purchasing an additional 1,127 shares during the period. 77.34% of the stock is owned by institutional investors and hedge funds.

Key Headlines Impacting Constellation Brands

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

• Positive Sentiment: Constellation Brands beat fiscal Q1 earnings expectations, topped revenue estimates, and reaffirmed FY27 guidance, reinforcing confidence in its beer portfolio and profitability. Reuters: Constellation Brands beats quarterly profit estimates on beer demand
• Positive Sentiment: Analysts at BMO Capital Markets, RBC, and Needham reaffirmed bullish ratings and maintained elevated price targets, suggesting some believe the post-earnings pullback leaves room for upside. Benzinga analyst updates
• Neutral Sentiment: Constellation Brands also declared a $1.03 quarterly dividend, which supports total return but is not a major near-term catalyst for the stock. Seeking Alpha: Constellation Brands declares $1.03 dividend
• Negative Sentiment: Multiple firms lowered price targets after Q1, citing softer volume trends, consumer weakness, inflation, and gas-price pressure that could weigh on demand. Benzinga: Constellation Brands analysts slash forecasts after Q1 results
• Negative Sentiment: Morgan Stanley highlighted long-term risk tied to declining alcohol consumption, adding to concerns about the company’s long-run growth profile. Yahoo Finance: Constellation faces long-term risks related to alcohol consumption

About Constellation Brands

Constellation Brands, Inc is a leading producer and marketer of beer, wine and spirits, with operations spanning production, importation, marketing and distribution. The company's beverage portfolio includes a range of premium and mainstream wines and spirits alongside major imported beer brands; in the U.S. market Constellation is widely known for its role in bringing Mexican imports such as Corona and Modelo to American consumers. Constellation supplies retail, on‑premise and foodservice channels and supports its brands with national sales and marketing platforms and supply‑chain capabilities.

The company traces its roots to the Canandaigua Wine Company, founded by Marvin Sands in 1945, and evolved through organic growth and acquisition into a diversified beverage company.

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