How does constellation make money?

constellation generates $10.2B in annual revenue (annual revenue · their business grew +371.7% last year).

What is STZ's XVARY composite score?

constellation (STZ) has an XVARY composite score of 66/100, rated average. This combines growth, value, risk, and momentum factors.

STZ — constellation stock analysis

Start here if you're new

what it is

Constellation sells imported beer, wine, and spirits, with beer doing most of the heavy lifting.

how it gets paid

Last year Constellation made $10.2B in revenue. Beer was the main engine at $8.6B, or 84% of sales.

why it's growing
Revenue grew 371.7% last year. The 4.0% EPS miss mattered most because STZ already has projected earnings growth of just 3.5%.

what just happened

The latest quarter showed revenue of $2.22B, but the market cared more that profit failed to clear expectations.

At a glance

B++ balance sheet — above average — nothing keeping you up at night

100/100 earnings predictability — you can trust these numbers

11.9x trailing p/e — the market's not buying it — or you found a deal

3.0% dividend yield — cash in your pocket every quarter

15.5% return on capital — nothing to write home about

xvary composite: 66/100 — average

What they do

Constellation sells imported beer, wine, and spirits, with beer doing most of the heavy lifting.

When you buy a Corona, you are feeding the part of STZ that produced 84% of 2024 sales, while wine and spirits made 16%. That concentration matters because the company already has 30 production facilities and 10,600 employees to keep those brands on shelves. Brand power → people ask for it by name → so you get repeat demand before price is even part of your decision.

consumer large-cap beverage-alcohol beer-led income

How they make money

$10.2B annual revenue · their business grew +371.7% last year

Beer

$8.6B

Wine

$1.6B

Spirits

$0.0B

Corporate operations

$0.0B

The products that matter

beer import rights and brand distribution

Corona & Modelo Rights

$10.2B company · legal flash point

the snapshot does not break out beer revenue, but this is the strategic asset investors fixate on because the import-rights dispute sits inside a $10.2B company earning 23.6% net margins.

key asset

wine production and brand portfolio

Wine Portfolio

part of a $10.2B business

wine is part of the same $10.2B company, but this page gives no separate sales figure. That's a data limitation, not a sign the segment does not matter.

data thin

spirits brands and premium labels

Spirits Portfolio

portfolio exposure

same story here: no segment number in the snapshot. if you own STZ, you own a portfolio company, even if the market mostly talks about the beer rights.

portfolio piece

Key numbers

11.9x

trailing p/e

P/E → price-to-earnings → what you pay for each dollar of profit. At 11.9x, you are paying less for STZ earnings than investors usually pay for branded consumer names.

15.5%

return on capital

Return on capital → profit generated from the money invested in the business → so what: STZ still turns capital into solid returns even in a slower year.

$9.8B

long-term debt

Long-term debt → money the company owes over many years → so what: it is 29% of capital, which is fine until growth slows and leverage starts feeling heavier.

3.0%

dividend yield

Dividend yield → your annual cash payout as a percent of the stock price → so what: you are getting paid while waiting for the stock to rerate.

Financial health

B++

strength

balance sheet grade B++ — above average financial health
risk rank 2 — safer than 80% of stocks
price stability 90 / 100
long-term debt $9.8B (29% of capital)
net profit margin 21.2% — keeps 21 cents of every dollar in revenue
return on equity 29% — $0.29 profit for every $1 investors have put in

B++ with risk rank and net profit margin standing out. your money faces less risk here than at most public companies.

Total return vs. market

You invested $10,000 in STZ 3 years ago → it's now worth $6,240.

The index would have given you $13,920.

same period. same starting point. STZ trailed the market by $7,680.

source: institutional data · total return

What just happened

missed estimates

The latest quarter showed revenue of $2.22B, but the market cared more that profit failed to clear expectations.

Consensus shows the last earnings report came in at $2.88 per share versus a $3.00 estimate, a 4.0% miss. Gross margin was still 52.1%, which tells you the brands still have pricing muscle even when execution gets messy.

$2.22B

revenue

$2.88

eps

52.1%

gross margin

the number that mattered

The 4.0% EPS miss mattered most because STZ already has projected earnings growth of just 3.5%, so there is not much room for slippage.

shares of constellation brands were quite volatile in the most-recently concluded calendar year.
the company’s wide 52-week trading range highlights mercurial shifts.
since our last report, stz shares have traded in the vicinity of their multi-year nadir.

the cautious stance is not surprising since broader market developments have weighed on consumer spending habits that are important for the alcohol company’s beer and wine & spirits segments.
although the fiscal 2025 second-quarter earnings result of $3.63 a share was better than expected, sales and earnings will likely decline at double-digit paces through fiscal 2025.

we are cautiously optimistic that the top and bottom lines will stage single-digit recoveries in fiscal 2026. the company intends to continue to offset the uncertain economic landscape through cost savings realizations and efficiency initiatives.
also, like its industry peers, price increases are likely to be ongoing.

also, the latest consumer price data has displayed some improved trends, such as a slowdown in inflation.

source: company earnings report, 2026

What could go wrong

the #1 risk is the AB InBev dispute over Corona and Modelo import rights. That is not background noise. It is the legal fight sitting behind the asset investors care most about.

∘

med

import-rights restrictions

A 2013 antitrust settlement restricts Constellation to importing Corona from Mexico rather than brewing it in the US. That is a real operating constraint, not a legal footnote.

If those terms tighten or enforcement escalates, the pressure lands on a company producing $10.2B in annual revenue.

∘

med

ongoing litigation with AB InBev

AB InBev has repeatedly accused Constellation of breaching the deal. Litigation keeps the key beer-rights story under a cloud, and the market is already pricing some of that cloud in.

Legal uncertainty is one reason a company with a 23.6% net margin still trades at 11.9x earnings.

∘

med

consumer pressure and pricing fatigue

The recent news flow points to weaker consumer spending and reliance on price increases plus cost savings. That works for a while. It is less comforting if volumes stay soft.

If consumer demand stays weak, the path from $11.60 full-year EPS to the $12.60 estimate gets harder.

These risks sit on top of $10.2B in annual revenue, $9.8B of long-term debt, and a stock already down enough that $10,000 became $6,240 in three years.

source: institutional data · regulatory filings · risk analysis

Pay attention to

risk

AB InBev legal updates

Any ruling, settlement shift, or enforcement move around Corona and Modelo import rights matters more than a routine quarterly beat.

metric

EPS recovery from $11.60 to $12.60

That is the cleanest scoreboard on the page. If earnings do not recover, the cheap multiple is less interesting.

calendar

next guidance reset

Management's next full-year outlook needs to show the business stabilizing, not just surviving on price increases and cost cuts.

trend

institutional selling streak

Three straight quarters of net selling is a message. A reversal would be one of the first signs the market is willing to trust the story again.

Analyst rankings

short-term outlook

average

momentum score 3 — in human-speak, analysts see a stock moving with the market, not breaking away from it.

risk profile

above average

stability score 2 — safer than roughly 80% of stocks. The business is steadier than the headlines make it feel.

chart momentum

bottom 5%

technical score 5 — the lowest rating. Translation: the chart is still in the basement until proven otherwise.

earnings predictability

100 / 100

management has historically been reliable. The issue is not surprise. It is the direction of the numbers.

source: institutional data

Institutional activity

institutions have been net selling for 3 consecutive quarters — 414 buyers vs. 647 sellers in 3q2025. total institutional holdings: 0.1B shares. net selling for 3 quarters.

source: institutional data · 1q2025-3q2025

source: institutional data

Price targets

3-5 year target range

$115 $234

$139 current price

$175 target midpoint · +26% from current · 3-5yr high: $310 (+125% · 24% ann'l return)

source: institutional data · analyst targets

The deep dive

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bull / base / bear scenarios

competitive moat breakdown

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operating model projections

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