Constellation Brands (STZ) Fiscal Q2 2027 Earnings Call: EPS Guidance Reaffirmed
Source Tradingkey
Key Takeaways
- Constellation Brands said fiscal Q2 2027 results exceeded its internal expectations and reiterated comparable EPS guidance of $11.20 to $11.90. Management expects results at the high end if positive September trends continue.
- September demand improved beyond Labor Day timing effects, supported by college football and other marketing programs. Management described the recovery as broad-based across consumers and channels.
- Beer distributor inventories have been rebuilt after entering fiscal 2027 at unusually low levels. For the full year, management expects shipments and depletions to track within 99% of each other.
- Pacifico became a top 10 beer brand and grew by approximately 20% year to date, while Victoria posted mid-teens growth in the first half.
- Management expects second-half beer operating margin of 34.5% to 35.5%. Marketing is projected at about 10% of net sales for the second half and above 11% in Q3.
- Year-to-date share repurchases reached $530 million, with $2.5 billion remaining under an authorization running through fiscal 2028.
Key Financial Data
| Metric | Fiscal Q2 2027 earnings call update |
|---|---|
| Comparable EPS guidance | $11.20-$11.90 for fiscal 2027; high end expected if September trends continue |
| Second-half beer operating margin | 34.5%-35.5% |
| Second-half SG&A | Approximately 7% of net sales |
| Second-half marketing | Approximately 10% of net sales |
| Q3 marketing | Above 11% of net sales |
| Year-to-date share repurchases | $530 million |
| Remaining repurchase authorization | $2.5 billion through fiscal 2028 |
| Cost efficiencies since Investor Day | Approximately $600 million |
| Veracruz annualized depreciation | Approximately $75 million, or about 90 basis points of margin headwind after entering service |
Business and Operating Performance
Disclaimer: For information purposes only. Past performance is not indicative of future results.
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