Constellation Brands stock target cut to $230 by Bernstein

On Wednesday, Bernstein analysts adjusted their outlook on Constellation Brands (NYSE:STZ) shares in response to new tariffs on Mexican imports. The firm’s price target was lowered from $300.00 to $230.00, though they maintained an Outperform rating on the stock. The adjustment comes as the company’s shares have already declined nearly 30% over the past six months, according to InvestingPro data.

The tariffs, set at 25%, directly affect Constellation Brands due to its significant reliance on Mexican beer imports, which are expected to account for approximately 84% of its net sales for Fiscal Year 2025. Bernstein’s move to revise their model comes after warnings about the potential impact of such trade barriers on their financial projections. The company, currently valued at $31.18 billion, has maintained a modest revenue growth of 3.7% over the last twelve months.

As a result of the tariffs, Bernstein has reduced its earnings per share (EPS) estimates for Constellation Brands by roughly 25%. Despite the reduced EPS forecast and new price target, Bernstein continues to see the company’s stock in a positive light with an Outperform rating.

The analysts noted that any potential resolution to the tariff situation could provide a significant boost to Constellation Brands that is not currently reflected in their estimates. However, they also acknowledged ongoing uncertainties, including recent weak scanner data, which could pose further challenges for the company.

Bernstein’s updated analysis reflects the immediate effects of the tariffs on Constellation Brands’ financial outlook, emphasizing the significant impact trade policies can have on companies heavily reliant on imported goods.

In other recent news, Constellation Brands has seen a series of analyst adjustments and evaluations. Piper Sandler downgraded the company’s stock rating from Overweight to Neutral, citing the impact of newly imposed tariffs on Mexican imports and a reduction in earnings per share (EPS) forecasts for fiscal years 2026 and 2027. The firm’s price target was also reduced to $200. In contrast, RBC Capital Markets maintained an Outperform rating with a price target of $293, suggesting that the stock’s current value already accounts for tariff impacts and presents a buying opportunity.

Morgan Stanley (NYSE:MS) also downgraded Constellation Brands from Overweight to Equal-weight, lowering the price target to $202 due to concerns over the company’s beer segment growth prospects. However, the firm noted that the current share valuation appears reasonable. Bernstein SocGen Group, while maintaining an Outperform rating, reduced its price target from $315 to $300, citing concerns about potential U.S. alcohol tariffs and their effect on earnings.

Despite these varied outlooks, Piper Sandler reaffirmed an Overweight rating and a $245 price target, highlighting potential long-term market share gains for Constellation Brands, particularly through its Modelo and Pacifico expansions. The company’s strategies for growth and adaptation to market challenges remain under close observation by investors and analysts alike. These recent developments reflect the complexities and uncertainties facing Constellation Brands in a shifting market landscape.

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