Beer company Constellation Brands Inc (NYSE:STZ) has become a new favorite of Berkshire Hathaway Inc (NYSE:BRK)(NYSE:BRK) with the Warren Buffett-led conglomerate adding the stock in recent quarters. The company expects to report second-quarter results on Monday after the market closes.
Here are the earnings estimates, what analysts are saying ahead of the report and key items to watch.
Earnings Estimates: Analysts expect Constellation to report second-quarter revenue of $2.46 billion. That’s down from $2.92 billion in last year’s second quarter, according to data from Benzinga Pro.
The company missed analyst estimates in the first quarter, but beat analyst estimates in six of the last 10 quarters.
Analysts expect Constellation Brands to report second-quarter earnings per share of $3.38, down from $4.32 in last year’s second quarter.
The company missed earnings per share estimates in the first quarter. It beat analyst estimates in nine of the last 10 quarters overall.
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What Analysts Are Saying: Analysts have been lowering their price targets on Constellation Brands ahead of the quarterly results.
Bank of America Securities analyst Peter Galbo lowered his price target from $182 to $150. The analyst also downgraded the stock from Neutral to Underperform.
Beer consumption is soft, he says. That could hurt the company’s sales and margins.
“Compounding this slowing consumption are more difficult 3Q YoY compares,” Galbo said. Also, there’s pressure on the company’s core Hispanic demographic.
Here are other recent analyst ratings on Constellation Brands and their price targets:
- UBS: Maintained Buy rating, lowered price target from $205 to $175
- Goldman Sachs: Maintained Buy rating, lowered price target from $196 to $168
- Wells Fargo: Maintained Overweight rating, lowered price target from $170 to $155
- Citigroup: Maintained Neutral rating, lowered price target from $155 to $145
Key Items to Watch: Constellation Brands has become a favorite of Buffett and Berkshire Hathaway. The conglomerate disclosed a stake in the company in the fourth quarter of last year and has added to the position multiple times.
In the first quarter, the stake was disclosed as being up by 114%. In the second quarter, the stake increased by 12%.
The third quarter disclosure could reveal another increased stake. Right now, Berkshire Hathaway owns 13.4 million shares worth $1.9 billion, according to data from CNBC. While Constellation Brands represents only 0.6% of the Berkshire Hathaway investing portfolio, the stake is good for around 7.6% ownership of the beer company.
The stake by Buffett and company could signal that shares are undervalued and see more investors watching for signs of a rebound in the quarterly sales figures, margins and guidance.
Constellation Brands stock has been hit by fear of the impact from tariffs with Mexico among the countries targeted by President Donald Trump.
Benzinga recently reported that Constellation’s Modelo Especial beer lost its title of being the bestselling beer in America. The beer brand took the title from Bud Light in 2023 and has now lost the crown to Michelob ULTRA.
Anheuser-Busch InBev’s gain comes from Constellation seeing weaker demand for Modelo Especial in recent months. Hispanic buyers are buying less beer due to higher prices, a weak job market, and immigration concerns, according to CEO Bill Newlands. Hispanic buyers reportedly account for around half of Constellation’s beer business.
Constellation previously lowered its full-year guidance earlier this year, with net beer sales expected to decline 2% to 4%, compared to a previous range of flat to a gain of 3% year-over-year. Analysts and investors will be looking to see if guidance has improved.
STZ Price Action: Constellation Brands stock is down 2.4% to $138.75 on Monday versus a 52-week trading range of $131.20 to $247.63. Constellation Brands’ stock is down 37.7% year-to-date in 2025.
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