Constellation Brands' Fiscal 2027 Guidance Seen Intact Despite Beer Weakness, RBC Says

MT Newswires Live06-26

Constellation Brands (STZ) is expected to reaffirm its fiscal 2027 guidance, with recent beer category weakness appearing cyclical and Q1 results likely to meet consensus expectations despite flat beer depletions, RBC Capital Markets said in a Friday note.

The brokerage said recent beer volume weakness was driven mainly by temporary economic factors, including higher fuel prices and unfavorable weather, with June volumes improving on easing gasoline prices and World Cup-related demand.

RBC expects the World Cup and gasoline price relief to provide near-term volume catalysts, and believes management will strike a more optimistic tone on beer volumes while maintaining its full-year outlook.

The firm said an in-line quarter, reaffirmed guidance and improving beer volume trends should support investor sentiment, as it views the recent category slowdown as temporary rather than a sign of weakening fundamentals.

RBC maintained its outperform rating on the stock and a $185 price target.

Price: 146.41, Change: +1.96, Percent Change: +1.36

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