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Investing.com -- Constellation Brands (NYSE:STZ) unveiled annual guidance that fell short of estimates, as the impact of U.S. President Donald Trump's sweeping tariffs overshadowed fourth-quarter results that beat estimates.
Shares the group slipped by more than 3% in premarket U.S. trading on Thursday.
For the three months ended February 28, the company reported adjusted per-share income of $2.63 on revenue of $2.16 billion, copmared with Wall Street projections of $2.33 and $2.15 billion, respectively. The beverage maker also announced a $4 billion stock buyback plan.
"Constellation reported better than expected fourth-quarter results, but given the uncertain environment, investor focus is more on the forward outlook," analysts at Morgan Stanley (NYSE:MS) led by Dara Mohsenian said in a note to clients.
The company, whose brands include Corona and Pacifico, said it expected earnings per share to be in a range of $12.60 to $12.90, missing estimates of $13.46.
In a statement, Constellation flagged that its "[f]iscal 2026 outlook and guidance assumptions reflect the anticipated impact of the tariffs announced by the U.S. government on April 2, 2025."
On Wednesday, with financial markets around the world roiling, Trump abruptly revealed a reversal of most of his punishing and sweeping tariffs on a host of countries, saying he would pause them for 90 days. However, Trump said in a social media post that these nations would still face a "substantially lowered Reciprocal Tariff" of 10%.
Constellation also lowered its medium-term organic sales expectations for its key beer business to a range of 2% to 4%, down from a previous outlook of 7% to 9%.
In a separate release, Constellation announced that it had signed an agreement with drinks firm The Wine Group to divest its mainstream wine brands like Woodbridge and Meiomi. The transaction, which is expected to close floowing the end of the company's fiscal first quarter, is tipped to generate around $900 million in proceeds in its current financial year.
"[T]his is a healthy step, in particular making hard decisions on asset sales and setting more realistic beer growth goals," anlaysts at BofA said in a note.
(Yasin Ebrahim contributed reporting.)