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This Month's Bonus Article Berkshire Bought the Dip—Now Constellation Brands Is ReboundingReported by Leo Miller. Publication Date: 1/9/2026. 
Summary - Constellation Brands is rebounding sharply in early 2026 after a 36% loss last year, with its Q3 earnings beating expectations.
- Berkshire Hathaway increased its stake in STZ despite the stock’s downturn, signaling long-term confidence in its recovery potential.
- Strong beer segment performance, improving margins, and analyst price targets point to upside, even as broader alcohol demand remains uncertain.
After a disastrous 2025, shares of beer giant Constellation Brands (NYSE: STZ) are starting 2026 on a much brighter note. To the chagrin of Berkshire Hathaway (NYSE: BRK.B), Constellation delivered a total return of -36% last year. Prior to Warren Buffett's retirement, Berkshire initiated a position in Constellation during Q4 2024. As of September 2025, Berkshire held 13.4 million Constellation shares, valued near $1.8 billion at the time. Weakness in the beer market and softness among Constellation's customer base contributed to the stock's decline. Constellation lowered its full-year fiscal 2026 (FY2026) guidance in September 2025 because of the challenging environment. Note that the firm's fiscal year is several quarters ahead of the calendar year. If you missed out on gold's recent run…You've been given a second chance.
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A way that could've helped investors make 31 times more …65 times more … Even 469 times more than just buying gold. To solve this Golden Paradox, click here As of the Jan. 8 close, Constellation shares were up more than 7% in 2026. The stock has now rebounded roughly 16% since hitting a 2025 low near $128 in November. Its latest earnings report sent shares up about 5.3%. Let's break down that report to get an updated view on the stock. Constellation Delivers Impressive Bottom-Line Beat In Q3 FY2026, Constellation reported net revenue of $2.22 billion, a 10% decline that still topped analysts' expectations by roughly $52 million. The consumer staples company reported comparable (adjusted) earnings per share of $3.06, down about 6% year over year but well ahead of the consensus estimate of $2.63, which had implied a 19% drop. Constellation's beer segment — roughly 90% of revenue — saw sales fall 1%. That decline was smaller than the broader beer category, allowing Constellation to gain market share. Across a weak backdrop, Constellation's beer business has consistently outperformed: in Q1 and Q2 FY2026 it led the beer category in dollar share gains, as it did in FY2025. Despite the slight sales decline, the beer segment's operating margin ticked up by 10 basis points, indicating effective cost management. Holding back the company's overall growth was the Wine & Spirits segment, where sales plunged 51% — primarily the result of Constellation's divestment of SVEDKA vodka and part of its wine portfolio. Excluding those divestitures, Wine & Spirits sales fell about 7%. Applying the same exclusions companywide, sales declined roughly 2%, a much smaller contraction than the reported 10% drop. Overall, Constellation's performance this quarter was solid given the backdrop. Coming Off Multi-Year Lows, STZ Could Have Significant Room to Run Trading around $148, Constellation has only partially recovered from its 2025 low near $128. That low wasn't just last year's bottom — it was the lowest share price since April 2020, shortly after the COVID-19 market crash in March of that year. Put another way, Constellation isn't merely bouncing off a short-term trough; it's starting a recovery from a deep, multi-year drawdown. That creates the potential for a more extended rally. Berkshire Buys and Price Targets Support Constellation's Upside Berkshire bought over 6 million Constellation shares in Q1 2025, when the stock's lowest closing price that quarter was $158. That price is roughly 7% above the current level, implying Berkshire's purchases were at prices modestly higher than today's. Since initiating the position, Berkshire has added to its stake, which can be read as continued confidence in the company despite the stock's declines. That accumulation suggests Berkshire may see meaningful upside in Constellation. Analysts appear constructive as well: the MarketBeat consensus price target of about $182 implies roughly 23% upside from the recent trading level. Still, the beer industry faces notable questions. A recent Gallup poll found just 54% of Americans reported drinking alcohol — the lowest share ever recorded. That figure has dipped to similar levels in prior periods and later rebounded, suggesting some of the decline may be cyclical rather than structural. If consumption trends recover, it would be a meaningful tailwind for Constellation. Couple that potential recovery with Constellation's track record of beer share gains and its current valuation, and the company's outlook leans toward the upside.
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