How Will Constellation Brands Stock React To Its Upcoming Earnings?

Constellation Brands (NYSE:STZ) is scheduled to report its earnings on Wednesday, April 9, 2025. For the current quarter, consensus estimates anticipate earnings of $2.27 per share on sales of $2.12 billion. This represents a slight decrease compared to the same period last year, when the company reported earnings of $2.26 per share on sales of $2.14 billion. This modest year-over-year change likely reflects a softening consumption trend, potentially driven by falling consumer sentiment.

This challenging environment may be contributing to the significant 20% decline in STZ stock observed so far this year. While this drop is partly attributable to the broader market downturn, wider economic anxieties appear to be amplifying these concerns. Specifically, President Donald Trump’s recent announcement of sweeping tariffs on goods from over 100 countries has heightened worries about potential negative impacts on the U.S. economy and, consequently, consumer spending. Therefore, the combination of this softening consumer demand and the prevailing broader economic uncertainty creates a challenging outlook for consumer-focused companies like Constellation Brands as they head into their earnings report.

The company has $31 Bil in current market capitalization. Revenue over the last twelve months was $10 Bil, and it was operationally profitable with $3.4 Bil in operating profits and net income of $686 Mil. While a lot will depend on how results stack up against consensus and expectations, understanding historical patterns might just turn the odds in your favor if you are an event-driven trader. There are two ways to do that: understand the historical odds and position yourself prior to the earnings release, or look at the correlation between immediate and medium-term returns post earnings and position yourself accordingly after the earnings are released. That said, if you seek upside with lower volatility than individual stocks, the Trefis High-Quality portfolio presents an alternative – having outperformed the S&P 500 and generated returns exceeding 75% since its inception.

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Constellation Brands’ Historical Odds Of Positive Post-Earnings Return

Some observations on one-day (1D) post-earnings returns:

• There are 19 earnings data points recorded over the last five years, with 7 positive and 12 negative one-day (1D) returns observed. In summary, positive 1D returns were seen about 37% of the time.
• However, this percentage decreases to 27% if we consider data for the last 3 years instead of 5.
• Median of the 7 positive returns = 2.1%, and median of the 12 negative returns =-3.3%

Additional data for observed 5-Day (5D), and 21-Day (21D) returns post earnings are summarized along with the statistics in the table below.

STZ observed 1D, 5D, and 21D returns post earnings

Correlation Between 1D, 5D, and 21D Historical Returns

A relatively less risky strategy (though not useful if the correlation is low) is to understand the correlation between short-term and medium-term returns post earnings, find a pair that has the highest correlation, and execute the appropriate trade. For example, if 1D and 5D show the highest correlation, a trader can position themselves “long” for the next 5 days if 1D post-earnings return is positive. Here is some correlation data based on 5-year and 3-year (more recent) history. Note that the correlation 1D_5D refers to the correlation between 1D post-earnings returns and subsequent 5D returns.

STZ Correlation Between 1D, 5D and 21D Historical Returns

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[1] Returns as of 4/8/2025
[2] Cumulative total returns since the end of 2016

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