Modelo Beer Maker Constellation brands’ stock plunges due to lower growth forecast

What you need to know

• Constellation Brands’ shares fell Friday after it cut its forecast as the consumer held back on spending.
• Bill Newlands of Newlands CEO said there was no way to predict when the consumer would be back spending more normally.
• It was a disappointment that the results were better than anticipated for the third quarter of fiscal year.

Constellation Brands’ (STZ), maker of beer and wine as well as spirits, cut back on its expectations Friday due to a slowdown in consumer spending.

Modelo Beer and Kim Crawford Wine, among other brands, have reduced their lower estimate of earnings per share for fiscal year 2025 to between 13.40 and 13.80. This is compared to an earlier projection that ranged from $13.60 to 13.780. The company said that it expects to see sales increase by 2%-5% in the current fiscal year. This is compared with its earlier prediction of a 4 to 6 percent rise.

Bill Newlands, CEO of the Chief Executive Office (CEO), said that Bill Newlands is a leader in this field. “near-term uncertainty on when consumers will revert to more normalized spending, we have prudently lowered our growth outlook.”

Lower Outlook offsets higher-than-expected Q3 results

Constellation Brands reported a EPS of 3.39, and revenues down 0.5% at $2.64 billion. Both exceeded estimates.

Sales of beer rose by 3%, to $2.03billion. Shipment volumes also increased by 1.6%. Wine and spirit sales fell 14% as a result of shipments. “weaker consumer demand and continued retailer inventory destocking across most price segments in the U.S. wholesale market."

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