Mixed expectations ahead of Constellation Brands earnings

Constellation Brands (STZ) is back in focus as investors look ahead to its upcoming first quarter fiscal 2027 earnings release, with forecasts pointing to modest profit growth but softer expectations after recent EPS estimate revisions.

Constellation Brands shares recently moved up with a 1-day share price return of 1% and a 7-day share price return of 2.32%, although the 1-year total shareholder return is down 8.03% and the 3-year total shareholder return is down 37.78%. This suggests momentum has been fading despite interest around the upcoming earnings release.

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With Constellation Brands trading at a discount to the average analyst price target and an intrinsic value estimate, the key question is whether you are seeing an undervalued consumer staples stock or a market that is already pricing in future growth.

Most Popular Narrative: 18% Undervalued

Compared with Constellation Brands' last close at $144.45, the most followed narrative anchors fair value around $176, framing the stock as meaningfully discounted ahead of earnings.

The company plans to generate approximately $9 billion in operating cash flow and $6 billion in free cash flow from fiscal '26 to fiscal '28. This robust cash flow will support investment in growth initiatives, primarily the modular development of their third brewery in Veracruz and additions to existing facilities in Mexico, potentially enhancing revenue.

Want to understand why that cash flow outlook underpins an $176 fair value for Constellation Brands? The narrative leans on steady top line assumptions, fatter margins, and a richer earnings multiple that still sits below many beverage peers. Curious which specific revenue and profit paths need to line up for that to hold? The full story connects those moving parts into one valuation roadmap.

Result: Fair Value of $176.09 (UNDERVALUED)

However, Constellation Brands still faces risks related to new tariffs and inflationary pressure on costs, as well as softer beer, wine, and spirits category trends.

Next Steps

With sentiment on Constellation Brands split between opportunity and concern, take a moment to review the data for yourself and weigh both sides using 6 key rewards and 1 important warning sign.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.