Latest news with #ConstellationBrands'
Yahoo
7 days ago
- Business
- Yahoo
How to Play Constellation Brands Stock After a 27% Drop in 6 Months
Constellation Brands, Inc. STZ has seen its shares plunge 26.5% in the past six months, underperforming the industry and Consumer Staples sector's rise of 2.5% and 2.8%, respectively. This sharp pullback reflects a combination of factors weighing on investor sentiment and company performance. Image Source: Zacks Investment Research STZ is also trading below its 50-day and 200-day moving averages, a key technical indicator that points to potential weakness in momentum. This suggests that the stock could face continued pressure unless an improvement in broader market sentiment emerges. Image Source: Zacks Investment Research Investors remain divided on whether Constellation Brands is headed for further downside or nearing a potential rebound. Constellation Brands' core Beer Business, traditionally its strongest growth engine, has faced decelerating depletion trends, particularly in key brands like Modelo and Corona. This slowdown is largely attributed to macroeconomic challenges affecting Hispanic consumers, the company's primary demographic, who have become more cautious in discretionary spending due to inflation, immigration-related uncertainty and job insecurity in key employment sectors. These conditions have dampened near-term demand for beer, especially in social and restaurant consumption company dramatically revised its medium-term beer net sales growth outlook from 7%-9% to a more conservative 2%-4% range for fiscal 2027 and 2028. This cautious stance was attributed to ongoing uncertainty around consumer sentiment, tariff impacts and a weaker beer industry backdrop, which is expected to be flat to down 2% in the near term. While STZ emphasized the strong brand health of its portfolio, this guidance cut raised concerns about underlying demand trends and potential structural shifts in consumer input costs, particularly from tariffs on aluminum cans, alongside inflation and moderated volume growth, have raised concerns about margin sustainability. Although the company reiterated its 39%-40% beer margin target, investors are wary that the levers to offset these headwinds may not be sufficient in the current environment, especially with weaker top-line growth and higher fixed costs from capacity expansions like Veracruz. Despite challenges, Constellation Brands' focus on premiumization is driving strong growth, particularly through its high-end Power Brands in Wine and Spirits. The Wine and Spirits business has been transitioning its portfolio toward higher-end brands that align better with consumer-led premiumization trends. Key growth drivers included the company's high-end Power Brands, such as The Prisoner Brand Family, Kim Crawford and Meiomi. The beer segment is also experiencing gains from premiumization, driven by growth in traditional beer and flavored categories, including seltzers, flavored beer, RTD spirits and flavored malt beverages. STZ is investing in its Power Brands through innovation and capitalizing on priority consumer trends with successful product Brands is progressing with its next phase of capacity expansion in Mexico to support growing demand for its high-end beer portfolio and the emerging Alternative Beverage Alcohol segment, including hard seltzers. With 48 million hectoliters of capacity at the end of fiscal 2025, the company plans to invest nearly $2 billion from fiscal 2026 to 2028 to develop its Veracruz brewery and expand existing sites. By fiscal 2028, capacity is expected to reach 55 million hectoliters. These efforts aim to strengthen its beer business, drive distribution gains and fuel innovation while resetting its cost base and refining its portfolio. Reflecting cautious sentiment around Constellation Brands, the Zacks Consensus Estimate for earnings per share (EPS) has seen downward revisions. In the past 30 days, the consensus mark for fiscal 2026 earnings has moved down 0.9% to $12.74. This suggests a year-over-year decline of 7.6% for fiscal 2026. The revisions highlight lingering concerns about STZ's near-term profitability outlook. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.) Image Source: Zacks Investment Research The ongoing headwinds and dismal guidance indicate that STZ stock lacks near-term growth potential. While its long-term strategies provide a foundation for recovery, concerns around declining margins, elevated cost and reduced earnings forecasts suggest caution. For now, investors may wait for signs of stabilization in earnings and margin trends before considering a position in STZ. The company currently carries a Zacks Rank #3 (Hold). Nomad Foods NOMD, which manufactures frozen foods, sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today's Zacks #1 Rank stocks here. NOMD delivered a trailing four-quarter earnings surprise of 3.2%, on average. The Zacks Consensus Estimate for Nomad Foods' current financial-year EPS indicates growth of 7.3% from the year-ago S.A. BRFS raises, produces and slaughters poultry and pork for the processing, production and sale of fresh meat, processed products, pasta, margarine, pet food and other products. It currently carries a Zacks Rank #2 (Buy). BRFS delivered a trailing four-quarter earnings surprise of 5.4%, on Zacks Consensus Estimate for BRF S.A.'s current fiscal-year sales and earnings implies growth of 0.3% and 11.1%, respectively, from the prior-year GroupAB OTLY, an oatmilk company, provides a range of plant-based dairy products made from oats. It presently has a Zacks Rank of 2. OTLY delivered a trailing four-quarter earnings surprise of 25.1%, on consensus estimate for Oatly Group's current fiscal-year sales and earnings implies growth of 2.7% and 65.8%, respectively, from the year-ago figures. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Constellation Brands Inc (STZ) : Free Stock Analysis Report BRF S.A. (BRFS) : Free Stock Analysis Report Nomad Foods Limited (NOMD) : Free Stock Analysis Report Oatly Group AB Sponsored ADR (OTLY) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
04-05-2025
- Business
- Yahoo
Constellation Brands (NYSE:STZ) shareholders have endured a 26% loss from investing in the stock a year ago
Passive investing in an index fund is a good way to ensure your own returns roughly match the overall market. But if you buy individual stocks, you can do both better or worse than that. Investors in Constellation Brands, Inc. (NYSE:STZ) have tasted that bitter downside in the last year, as the share price dropped 27%. That's well below the market return of 12%. Even if shareholders bought some time ago, they wouldn't be particularly happy: the stock is down 24% in three years. With that in mind, it's worth seeing if the company's underlying fundamentals have been the driver of long term performance, or if there are some discrepancies. We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free. In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price. Constellation Brands fell to a loss making position during the year. Buyers no doubt think it's a temporary situation, but those with a nose for quality have low tolerance for losses. Of course, if the company can turn the situation around, investors will likely profit. You can see below how EPS has changed over time (discover the exact values by clicking on the image). We like that insiders have been buying shares in the last twelve months. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. It might be well worthwhile taking a look at our free report on Constellation Brands' earnings, revenue and cash flow. While the broader market gained around 12% in the last year, Constellation Brands shareholders lost 26% (even including dividends). Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Longer term investors wouldn't be so upset, since they would have made 4%, each year, over five years. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Even so, be aware that Constellation Brands is showing 2 warning signs in our investment analysis , you should know about... Constellation Brands is not the only stock that insiders are buying. For those who like to find lesser know companies this free list of growing companies with recent insider purchasing, could be just the ticket. Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on American exchanges. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Yahoo
25-04-2025
- Business
- Yahoo
Read This Before Considering Constellation Brands, Inc. (NYSE:STZ) For Its Upcoming US$1.02 Dividend
Constellation Brands, Inc. (NYSE:STZ) stock is about to trade ex-dividend in 3 days. Typically, the ex-dividend date is one business day before the record date, which is the date on which a company determines the shareholders eligible to receive a dividend. The ex-dividend date is important because any transaction on a stock needs to have been settled before the record date in order to be eligible for a dividend. In other words, investors can purchase Constellation Brands' shares before the 29th of April in order to be eligible for the dividend, which will be paid on the 15th of May. The company's next dividend payment will be US$1.02 per share. Last year, in total, the company distributed US$4.08 to shareholders. Calculating the last year's worth of payments shows that Constellation Brands has a trailing yield of 2.2% on the current share price of US$187.50. Dividends are a major contributor to investment returns for long term holders, but only if the dividend continues to be paid. As a result, readers should always check whether Constellation Brands has been able to grow its dividends, or if the dividend might be cut. We've discovered 2 warning signs about Constellation Brands. View them for free. Dividends are usually paid out of company profits, so if a company pays out more than it earned then its dividend is usually at greater risk of being cut. Constellation Brands paid a dividend last year despite being unprofitable. This might be a one-off event, but it's not a sustainable state of affairs in the long run. With the recent loss, it's important to check if the business generated enough cash to pay its dividend. If Constellation Brands didn't generate enough cash to pay the dividend, then it must have either paid from cash in the bank or by borrowing money, neither of which is sustainable in the long term. It distributed 38% of its free cash flow as dividends, a comfortable payout level for most companies. Check out our latest analysis for Constellation Brands Click here to see the company's payout ratio, plus analyst estimates of its future dividends. Companies with consistently growing earnings per share generally make the best dividend stocks, as they usually find it easier to grow dividends per share. If earnings fall far enough, the company could be forced to cut its dividend. Constellation Brands reported a loss last year, but at least the general trend suggests its income has been improving over the past five years. Even so, an unprofitable company whose business does not quickly recover is usually not a good candidate for dividend investors. Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. In the last 10 years, Constellation Brands has lifted its dividend by approximately 13% a year on average. It's encouraging to see the company lifting dividends while earnings are growing, suggesting at least some corporate interest in rewarding shareholders. Get our latest analysis on Constellation Brands's balance sheet health here. Should investors buy Constellation Brands for the upcoming dividend? We're a bit uncomfortable with it paying a dividend while being loss-making. However, we note that the dividend was covered by cash flow. In summary, while it has some positive characteristics, we're not inclined to race out and buy Constellation Brands today. However if you're still interested in Constellation Brands as a potential investment, you should definitely consider some of the risks involved with Constellation Brands. To help with this, we've discovered 2 warning signs for Constellation Brands that you should be aware of before investing in their shares. If you're in the market for strong dividend payers, we recommend checking our selection of top dividend stocks. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
Miami Herald
15-04-2025
- Business
- Miami Herald
CEO of popular beer brand spots concerning consumer trend
From the beginning of his second presidential campaign, President Donald Trump expressed his commitment to cracking down on illegal immigration, and he has begun to enact his political agenda now that he is back in office. Trump's policy changes and mass deportation plans have heightened the U.S. Hispanic community's concerns. Don't miss the move: Subscribe to TheStreet's free daily newsletter And with such challenges emerging amid rising costs of essential goods and high Hispanic unemployment rates, these consumers have become more cautious in their spending. Related: Popular convenience store chain closing locations The Hispanic community makes up around 19.5% of the total U.S. population, representing the nation's largest racial minority and a large part of the economy. This has caused the softening in spending to begin trickling down, affecting companies that depend on those key consumers. Constellation Brands (STZ) is a leading international producer and marketer of beer, wine, and spirits. This company has been serving millions of consumers since 1945 and rose to fame thanks to its renowned liquor brands. Beer is one of Constellation Brands' biggest revenue sources. It owns popular brands such as Modelo, Corona, Especial, and Pacífico. Although beer is consumed globally, the Hispanic community is loyal to these beer brands and takes the lead in demand, making up around 50% of Constellation Brands' overall beer business, according to the company. Related: Liquor giant trades Diddy's vodka for Lebron James' tequila stake However, recent immigration policies and economic uncertainty have challenged the Hispanic consumer, contributing to the company's flat net beer sales and nearly 2% decline in shipments during the fourth quarter of fiscal 2025, as stated in its earnings report. "Social gatherings, an area where the Hispanic consumer often consumes beer, are declining today as part of these overarching concerns they have," said Constellation Brands CEO Bill Newlands in an earnings call. Despite the turbulent times, Constellation Brands believes that sales will improve once these issues have died down. So, to keep the business running and fight the slowdown, the company will focus on what it can control - distribution, innovation, and improving brand awareness. "When you look at our awareness levels versus some of the competition, when you look at our shelf positions versus some of the larger competition, we still have a lot of runway to grow. We have a lot of expansion capability of reaching," said Newlands. More Retail News: Key Coca-Cola, Pepsi rival embraces new beverage trendIconic retail chain reveals dates and places for store closuresIconic breakfast chain slashes menu, cuts promotions For the last several years, Constellation Brands has made an effort to increase marketing spend to support the business, even when it began to hit a slowdown last year. The company has seen a return on its investment. It expects to put another $200 million into marketing over the next 2.5 fiscal years, believing this will help drive future success. Because of all the uncertainties, Constellation Brands lowered its guidance for fiscal 2026, anticipating beer sales to grow at a flat or 3% rate, down from its previously forecasted 7% to 9%. The company predicts that the overall beer industry will be roughly flat to down 2%. Related: Veteran fund manager unveils eye-popping S&P 500 forecast The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Associated Press
14-04-2025
- Business
- Associated Press
INVESTOR DEADLINE APPROACHING: Robbins Geller Rudman & Dowd LLP Announces that Constellation Brands, Inc. Investors with Substantial Losses Have Opportunity to Lead Class Action Lawsuit
SAN DIEGO, April 14, 2025 (GLOBE NEWSWIRE) -- The law firm of Robbins Geller Rudman & Dowd LLP announces that purchasers or acquirers of Constellation Brands, Inc. (NYSE: STZ) securities between April 11, 2024 and January 8, 2025, both dates inclusive (the 'Class Period'), have until Monday, April 21, 2025 to seek appointment as lead plaintiff of the Constellation Brands class action lawsuit. Captioned Meza v. Constellation Brands, Inc., No. 25-cv-06107 (W.D.N.Y.), the Constellation Brands class action lawsuit charges Constellation Brands and certain of Constellation Brands' top executives with violations of the Securities Exchange Act of 1934. If you suffered substantial losses and wish to serve as lead plaintiff of the Constellation Brands class action lawsuit, please provide your information here: You can also contact attorneys J.C. Sanchez or Jennifer N. Caringal of Robbins Geller by calling 800/449-4900 or via e-mail at [email protected]. CASE ALLEGATIONS: Constellation Brands produces, imports, markets, and sells beer, wine, and spirits. The Constellation Brands class action lawsuit alleges that defendants throughout the Class Period: (i) created the false impression that they possessed reliable information pertaining to Constellation Brands' Wine and Spirits business; (ii) failed to improve mix, inventory, and sales execution; and (iii) failed to disclose that investments made in media spend and price promotions as well as adjustments in sales capabilities to support distributor partners had not been as effective as they claimed. The Constellation Brands class action lawsuit further alleges that on January 10, 2025, Constellation Brands announced its third quarter fiscal year 2025 results, revealing a significant miss on sales performance in the Beer segment and an even steeper miss for the Wine and Spirits segment. On this news, the price of Constellation Brands' stock fell. THE LEAD PLAINTIFF PROCESS: The Private Securities Litigation Reform Act of 1995 permits any investor who purchased or acquired Constellation Brands securities during the Class Period to seek appointment as lead plaintiff in the Constellation Brands class action lawsuit. A lead plaintiff is generally the movant with the greatest financial interest in the relief sought by the putative class who is also typical and adequate of the putative class. A lead plaintiff acts on behalf of all other class members in directing the Constellation Brands class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the Constellation Brands class action lawsuit. An investor's ability to share in any potential future recovery is not dependent upon serving as lead plaintiff of the Constellation Brands class action lawsuit. ABOUT ROBBINS GELLER: Robbins Geller Rudman & Dowd LLP is one of the world's leading law firms representing investors in securities fraud cases. Our Firm has been #1 in the ISS Securities Class Action Services rankings for six out of the last ten years for securing the most monetary relief for investors. We recovered $6.6 billion for investors in securities-related class action cases – over $2.2 billion more than any other law firm in the last four years. With 200 lawyers in 10 offices, Robbins Geller is one of the largest plaintiffs' firms in the world and the Firm's attorneys have obtained many of the largest securities class action recoveries in history, including the largest securities class action recovery ever – $7.2 billion – in In re Enron Corp. Sec. Litig. Please visit the following page for more information: Past results do not guarantee future outcomes. Services may be performed by attorneys in any of our offices. Contact: Robbins Geller Rudman & Dowd LLP J.C. Sanchez, Jennifer N. Caringal 655 W. Broadway, Suite 1900, San Diego, CA 92101 800-449-4900 [email protected]
