MW Jack Daniel's parent surprises investors, showing increases in alcohol sales and profits
By Tomi Kilgore
Brown-Forman's stock was set to have its best day in eight months after the spirits seller's latest quarterly results snapped a number of negative streaks
Jack Daniel's parent's stock was surging Wednesday after the company reported that quarterly sales rose for the first time in more than two years. Wall Street had been expecting another decline.
Shares of Brown-Forman were rallying in early Wednesday trading after the Jack Daniel's parent company's fiscal third-quarter results snapped a number of negative streaks.
There had been growing concern that people drinking less alcohol was not simply a cyclical trend but a secular change in behavior. The worries were heightened last week after Diageo, the parent company of Johnnie Walker and Guinness, cut its sales outlook and slashed its dividend.
But Brown-Forman's $(BF.B)$ latest earnings report provided some hope that Diageo's $(DEO)$ outlook may be company-specific, and that people may have started drinking more again.
Brown-Forman, which is also the parent of Herradura tequila and Chambord liqueur, reported the first year-over-year growth in quarterly sales in nine quarters, the first profit growth in five quarters and the first profit beat in four quarters.
The stock surged 4.9% in recent morning trading, enough to make it one of the S&P 500 index's SPX best performers and to put it on track for its biggest gain in eight months. The stock was also set to snap a three-quarter streak of post-earnings declines.
Sales for the quarter to Jan. 31 rose to $1.06 billion from $1.04 billion a year ago, while analysts surveyed by FactSet were expecting sales to slip to $1 billion.
And earnings per share ticked up a penny to 58 cents, while the FactSet consensus called for a 10-cent drop to 47 cents.
So far this year, whiskey sales increased 2%, boosted by the launch of Jack Daniel's Tennessee Blackberry and strength in Jack Daniel's Tennessee Apple in Brazil, which offset weakness in Jack Daniel's Tennessee Whiskey and Jack Daniel's Tennessee Honey.
And sales of the company's ready-to-drink offerings continued to grow, while tequila sales fell.
Looking ahead, the company said the spirits market will likely remain challenging amid uncertainties in consumer behavior given current geopolitical volatility, as well as weakness in sales of used barrels. But on the bright side, the company kept its full-year guidance intact and said it believes it will be able to "unlock" growth through changes in its distribution network and new products.
Despite the upbeat results, Brown-Forman and the spirits market as a whole are certainly not out of the woods yet. As RBC Capital analyst Nik Modi wrote before the results were released, while there were some signs that demand was improving, there are concerns about the sustainability of any recovery due to increased competitive pressures and still-muted trends in the core Jack Daniel's brand.
Brown-Forman's stock has lost 9.9% over the past 12 months, while Diageo's U.S.-listed shares have shed 22.9% and the S&P 500 has advanced 18%.
-Tomi Kilgore
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March 04, 2026 10:09 ET (15:09 GMT)
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