With a market cap of $40.4 billion, Constellation Brands, Inc. (STZ) is a leading producer and marketer of beer, wine, and spirits, headquartered in Victor, New York. The company is renowned for its premium beverage portfolio, which includes iconic brands such as Corona, Modelo, and Robert Mondavi. It is expected to announce its fiscal Q3 earnings results before the market opens on Thursday, Jan. 9.
Ahead of the event, analysts expect STZ to report a profit of $3.34 per share, up 4.7% from $3.19 per share in the year-ago quarter. The company has surpassed Wall Street's bottom-line estimates in each of the past four quarters. In the previous quarter, the company surpassed the consensus estimates by 5.1%, thanks to robust demand for its popular beer brands, which helped soften the hit from a slump in its wines and spirits business.
For fiscal 2025, analysts expect STZ to report an EPS of $13.72, up 13.8% from $12.06 in fiscal 2024. In addition, EPS is expected to grow 10.6% year-over-year to $15.18 in fiscal 2026.
However, STZ has fallen 9.1% over the past 52 weeks, underperforming both the S&P 500 Index's ($SPX) 23.8% rise and the Consumer Staples Select Sector SPDR Fund's (XLP) 8.8% increase over the same period.
Despite beating earnings expectations with an adjusted EPS of $4.32, STZ shares tumbled over 4% on Oct. 3 following the release of its Q2 earnings results. The decline was driven by adjusted revenue of $3.1 billion falling short of market expectations. Adding to the pressure, the fiscal 2025 outlook disappointed investors, projecting a 4%-6% decline in wine and spirits sales and a 16%-18% drop in segment operating income, which overshadowed the positive growth momentum in the beer segment.
Analysts' consensus view on Constellation Brands stock is highly bullish, with a "Strong Buy" rating overall. Among 21 analysts covering the stock, 14 recommend a "Strong Buy," two suggest a "Moderate Buy," and five give a "Hold" rating. This configuration is less bullish than three months ago, with 16 analysts suggesting a "Strong Buy."
The average analyst price target for STZ is $290.14, suggesting a potential upside of 32.1% from the current levels.