Constellation Brands (NYSE:STZ) Sets New 52-Week Low After Analyst Downgrade

Key Points

• Constellation Brands shares hit a new 52-week low, falling to $110.60 after Wells Fargo cut its price target from $170 to $140, though it maintained an “overweight” rating.
• Analyst sentiment has weakened, with several firms reducing price targets; the stock carries an average “Hold” rating and a consensus price target of $157.40.
• Institutional investors remain heavily invested, owning 77.34% of the shares, while several major funds increased their positions during recent quarters.

Constellation Brands Inc (NYSE:STZ - Get Free Report) shares hit a new 52-week low during mid-day trading on Tuesday after Wells Fargo & Company lowered their price target on the stock from $170.00 to $140.00. Wells Fargo & Company currently has an overweight rating on the stock. Constellation Brands traded as low as $110.60 and last traded at $113.2850, with a volume of 2942047 shares. The stock had previously closed at $112.87.

Several other equities research analysts have also recently weighed in on the company. BNP Paribas Exane decreased their price target on Constellation Brands from $115.00 to $110.00 and set an "underperform" rating on the stock in a research report on Monday, September 21st. Deutsche Bank Aktiengesellschaft cut 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. Freedom Capital lowered shares of Constellation Brands from a "strong-buy" rating to a "hold" rating in a report on Wednesday, July 1st. Barclays lowered their target price on shares of Constellation Brands from $132.00 to $122.00 and set an "equal weight" rating on the stock in a research note on Tuesday, September 22nd. Finally, Royal Bank Of Canada reissued an "outperform" rating and issued a $185.00 price target on shares of Constellation Brands in a report on Friday. Eleven research analysts have rated the stock with a Buy rating, nine have given a Hold rating and two have given a Sell rating to the stock. According to data from MarketBeat.com, the stock presently has an average rating of "Hold" and an average price target of $157.40.

More Constellation Brands News

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

• Positive Sentiment: Wells Fargo lowered its price target from $170 to $140 but maintained an “overweight” rating, implying substantial potential upside from current levels. The continued bullish rating suggests the firm views the selloff as excessive if Constellation can stabilize its business. Constellation Brands Price Target Cut by Wells Fargo
• Positive Sentiment: Constellation’s approximately 3.6% dividend yield may appeal to income-focused investors while the stock trades at a relatively low valuation. However, earnings performance and the sustainability of the dividend remain important considerations. Constellation Brands Dividend Ahead of Earnings
• Neutral Sentiment: Analysts expect quarterly earnings per share of roughly $3.56. The report is likely to determine whether the company’s valuation and dividend can attract buyers or whether additional estimates and price targets are reduced. What to Expect From Constellation Brands Earnings
• Neutral Sentiment: Commentary from Jim Cramer and other previews emphasizes that investors will be watching management’s outlook and business trends—not just the headline results—for signs of a turnaround in the Corona and Modelo owner’s performance. Jim Cramer Looks Beyond the Numbers
• Negative Sentiment: The stock’s slide to 11-year lows has prompted warnings that investors may be trying to “catch a falling knife,” reflecting concerns about weakening sales, consumer demand and the risk of further earnings-estimate cuts. Constellation Brands Q2 Preview
• Negative Sentiment: Wells Fargo’s sizable target reduction from $170 to $140 signals that analysts have lowered their expectations, even though the firm remains positive on the shares.

Institutional Inflows and Outflows

Several hedge funds and other institutional investors have recently added to or reduced their stakes in STZ. Capital World Investors lifted its stake in Constellation Brands by 8.3% during the fourth quarter. Capital World Investors now owns 7,238,575 shares of the company's stock worth $998,740,000 after purchasing an additional 553,974 shares during the last quarter. Capital International Investors increased its position in shares of Constellation Brands by 48.5% during the 4th quarter. Capital International Investors now owns 6,442,600 shares of the company's stock valued at $888,930,000 after purchasing an additional 2,105,546 shares during the last quarter. Van ECK Associates Corp raised its holdings in shares of Constellation Brands by 11.0% during the 4th quarter. Van ECK Associates Corp now owns 2,397,275 shares of the company's stock valued at $330,728,000 after buying an additional 237,073 shares in the last quarter. Dimensional Fund Advisors LP raised its holdings in shares of Constellation Brands by 5.1% during the 1st quarter. Dimensional Fund Advisors LP now owns 1,826,652 shares of the company's stock valued at $274,029,000 after buying an additional 88,538 shares in the last quarter. Finally, Bank of America Corp DE lifted its position in Constellation Brands by 9.5% in the 1st quarter. Bank of America Corp DE now owns 1,403,275 shares of the company's stock worth $210,491,000 after buying an additional 121,515 shares during the last quarter. 77.34% of the stock is currently owned by hedge funds and other institutional investors.

Constellation Brands Stock Performance

The firm has a market cap of $19.35 billion, a PE ratio of 10.81, a price-to-earnings-growth ratio of 2.24 and a beta of 0.44. The company has a 50 day simple moving average of $126.62 and a 200-day simple moving average of $138.90. 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 Company Profile

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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