• Constellation Brands recently reported quarterly results that exceeded Wall Street expectations on both revenue and earnings, driven primarily by ongoing strength in its Modelo and Corona beer portfolio and reinforced by continued share repurchases and a focus on premium offerings.

• This combination of outperformance in the beer segment and management’s emphasis on returning cash to shareholders adds fresh context to earlier concerns about slower organic sales and capital allocation challenges.

• We’ll now examine how the strong beer-led quarter and renewed emphasis on shareholder returns may reshape Constellation Brands’ investment narrative.

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To own Constellation Brands, you need to believe its Mexican beer portfolio can offset slower organic sales elsewhere and justify the current valuation. The latest beer-led earnings beat supports that thesis in the short term, but it does not remove concerns around modest expected beer growth and pressure on margins as costs and tariffs evolve.

Among recent announcements, the ongoing share repurchases under the multi year, multibillion dollar authorization tie directly into this quarter’s story, reinforcing management’s focus on buybacks alongside dividends. For investors, that capital return program can amplify the impact of stable earnings, but it also sharpens the question of how much slower beer growth and rising input costs might limit future flexibility.

But investors should also be aware that if tariffs and inflation on key inputs like aluminum cans persist, then…

Read the full narrative on Constellation Brands (it’s free!)

Constellation Brands’ narrative projects $9.7 billion revenue and $2.2 billion earnings by 2028. This implies a 1.2% yearly revenue decline and a $2.64 billion earnings increase from -$442.3 million today.

Uncover how Constellation Brands’ forecasts yield a $171.22 fair value, a 21% upside to its current price.

Sixteen members of the Simply Wall St Community currently see fair value anywhere between US$118 and about US$326, with views spread right across that range. When you set those opinions against the reliance on premium beer margins and the risk of higher input costs, it becomes clear why it can pay to test your own expectations against several different viewpoints.