Constellation Brands (STZ) Stock Forecast & Price Target

Constellation Brands is positioned for growth as the beer category shows signs of reacceleration, evidenced by market share gains in 49 of 50 states and growth in total distribution points. Despite challenging macroeconomic conditions, the company has achieved mid-single-digit growth and is witnessing increasing loyalty scores among key consumer demographics, particularly within the Hispanic market. Additionally, projections for modest volume growth in 2027, along with expected beer operating margin expansion, further contribute to a positive outlook for the firm.

Constellation Brands has significantly reduced its financial guidance, projecting a decline in net sales across its beer segment, with anticipated growth disappointing at -4% to -2%, down from a previous range of 0% to +3%. The company's expectations for wine and spirits remain unchanged at a significant decline of -17% to -20%, contributing to an overall consolidated net sales outlook of -6% to -4%, reflecting a notable decrease from earlier forecasts. Additionally, the forecast includes an expected operating income decline of 9% to 7% for beer, alongside a projected contraction in operating margins of approximately 330 basis points, driven by declining volumes and increasing tariffs, further highlighting the challenges facing the company's financial performance.