Constellation Brands Outlook Revised by Truist Securities, Analysts Remain Positive
Truist Securities has revised its outlook on Constellation Brands (NYSE:STZ), lowering the stock's price target to $255.00 while maintaining a Hold rating. This adjustment comes after reevaluating the company's future sales and adjusted earnings per share (EPS) estimates.
The firm now expects Constellation Brands to achieve sales of $10.445 billion and an adjusted EPS of $13.70 for fiscal year 2025, down from the previous estimates of $10.569 billion and $13.72. Similarly, the fiscal year 2026 sales and adjusted EPS forecasts have been decreased to $10.969 billion and $14.86 from the earlier projections of $11.098 billion and $15.06.
Truist Securities expressed skepticism about Constellation Brands' management attributing the slowdown in the beer segment to economic factors and unemployment in key states. The firm remains cautious about the segment's recovery in the second half of the fiscal year.
Despite the revised outlook, analysts from Roth/MKM, Evercore ISI, and Goldman Sachs maintain positive ratings on Constellation Brands. Roth/MKM foresees strong beer shipments driving the company toward its FY25 guidance, while Goldman Sachs views it as a top growth story. Evercore ISI has adjusted its price target to $300.00 but maintains its Outperform rating.
InvestingPro Insights reveal that Constellation Brands has a market capitalization of $44.39 billion and a P/E ratio of 18.04, suggesting reasonable valuation. The company also has a solid financial position with a history of dividend increases and strong liquidity.
While some analysts have revised their earnings downwards, it's important for investors to consider all aspects of Constellation Brands' financial health. For a more in-depth analysis, InvestingPro offers 5 additional tips on the company's market prospects.
In conclusion, while there are some concerns about Constellation Brands' future performance, the company's solid financial foundation and positive analyst outlooks suggest potential for growth in the long term. Investors should consider these factors when making decisions about their portfolios.