Constellation Brands remains a sell as business fundamentals deteriorate, with no credible signs of stabilization or turnaround. STZ's Q1 2026 saw organic sales down 8% and operating income down 13%, with beer volumes falling 8.7% and the wine segment in operating loss. Despite a low P/E ratio, STZ's high EV/FCF multiple (25–26x) is unjustified for a shrinking, structurally challenged business.

ROCHESTER, N.Y., Dec. 04, 2025 (GLOBE NEWSWIRE) -- Constellation Brands, Inc. (NYSE: STZ), a leading beverage alcohol company, announced today it will report financial results for its third quarter ended November 30, 2025, on Wednesday, January 7, 2026, after the close of the U.S. markets by posting the earnings release and financial tables, as well as other supporting materials, on the company's investor relations website at ir.cbrands.com. A live conference call for analysts to discuss the company's financial results, operating performance, strategic business initiatives, and outlook for the future with President and Chief Executive Officer, Bill Newlands, and Executive Vice President and Chief Financial Officer, Garth Hankinson, will be hosted at 10:30 a.m. ET on Thursday, January 8, 2026.

Even a Warren Buffett buy-in isn't helping the shares these days. Shares have notably underperformed the market recently.

Waning consumption of alcohol is taking a toll on this company's top and bottom lines. Investors may be too focused on the past and present when they should be looking to the future.

Alcohol consumption is at multi-decade lows, taking a toll on the industry's bottom line. There are certain slivers of the booze business, however, that are doing just fine.

STZ leans into premiumization, innovation and strong beer momentum to capture shifting consumer tastes and fuel growth.

Despite recent consumption patterns, alcohol is likely not going away. Constellation's dividend looks increasingly favorable.

Constellation Brands is deeply undervalued and poised for recovery as capital rotates from overheated AI stocks to defensive consumer staples. STZ's focus on high-margin beer, strategic premiumization, and cost-saving restructuring position it well despite recent sales declines and sector headwinds. STZ trades at attractive valuation metrics versus peers, with a strong dividend history and robust governance supporting medium- to long-term value creation.

Constellation's core beer brands are rapidly gaining market share with its dominant brand portfolio, showing ~7.5% annual volume growth that consistently defies the declining U.S. beer industry. My DCF model indicates strong undervaluation with a fair value of $236 per share, offering a 68% upside as the market overemphasizes industry headwinds and ignores the company's strengths. A renewed focus on shareholder returns is underway, driven by a $4 billion stock buyback program and the strategic sale of underperforming assets.

Constellation Brands is facing softer demand, but trends are stabilizing, inventories are lean, and easier comparisons should help revenue performance improve through FY26 and recover in FY27. Strong execution around innovation, pricing flexibility, and shelf-space expansion is helping Constellation gain share despite macro pressures, positioning it well for growth when volumes rebound. Margins and earnings should recover as cost-saving programs ramp up, volume trends normalize, and valuation re-rates closer to historical levels, offering attractive upside for long-term investors.