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More Reading from MarketBeat Berkshire Bought the Dip—Now Constellation Brands Is ReboundingReported by Leo Miller. Publication Date: 1/9/2026. 
In Brief - 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 stronger footing. To the chagrin of Berkshire Hathaway (NYSE: BRK.B), Constellation delivered a total return of -36% last year. Berkshire initiated a position in Constellation in Q4 2024, and as of September 2025 held 13.4 million shares — valued near $1.8 billion at the time. Weakness across the beer category and Constellation's customer base contributed to the stock's decline. The company cut its full-year fiscal 2026 (FY2026) guidance in September 2025 amid the difficult operating backdrop. (Constellation's fiscal year runs several quarters ahead of the calendar year.) A former billion-dollar hedge fund manager is revealing his number one stock to trade for 2026 plus an over-the-shoulder demo of the exact strategy that delivered 20 straight winning years for his clients. His system closed 12 winning positions in the first 12 weeks of 2025 and finished the year with an 85 percent win rate, including gains of 58 percent in a single day. For a limited time, you can access his One Ticker Trader service for $19 instead of the usual $499, backed by a 30-day money back guarantee. Watch the free demo and see how the strategy works. Still, through the Jan. 8 close, Constellation shares were up more than 7% in 2026 and have rebounded roughly 16% from a 2025 low near $128 in November. Shares climbed 5.3% after the company's latest earnings report. Below, we break down that report to provide an updated view of the stock. Constellation Delivers Impressive Bottom-Line Beat In Q3 FY2026, Constellation reported net revenue of $2.22 billion, a 10% decline year-over-year but about $52 million above analysts' expectations. The consumer staples company posted comparable earnings per share of $3.06, down roughly 6% from the prior year but well ahead of consensus estimates of $2.63 (which had implied a 19% drop). Constellation's beer segment — roughly 90% of revenue — saw sales fall 1%. That decline, however, was smaller than the broader industry's, allowing Constellation to gain share. The company's beer business has consistently outperformed in a weak market: in Q1 and Q2 FY2026 it led the beer category in dollar share gains, a trend that also held through FY2025. Despite the sales decline, the beer segment's operating margin ticked up 10 basis points, highlighting effective cost management. The company's Wine and Spirits segment dragged on overall growth, with sales down 51%. Much of that reflects Constellation's divestiture of SVEDKA vodka and parts of its wine portfolio; excluding those exits, Wine and Spirits sales declined about 7%. On an adjusted basis that excludes those divestments across the company, sales fell roughly 2% rather than the headline -10%. Overall, Constellation's quarter was stronger than the top-line number suggests. Coming Off Multi-Year Lows, STZ Could Have Room to Run Trading around $148, Constellation has only partially recovered from its 2025 low near $128 — a level that was its lowest since April 2020, shortly after the COVID-19 market crash. That means Constellation is rebounding from a historic drawdown rather than a brief dip, which suggests meaningful upside potential if the recovery continues. Berkshire's Buying and Price Targets Support Upside Case Berkshire initially purchased Constellation shares in Q4 2024 and added more than 6 million shares in Q1 2025. In that quarter, Constellation's lowest closing price was $158, about 7% above the stock's current level — implying Berkshire bought material stakes at higher prices and may still see room for appreciation. Wall Street analysts also see upside. The MarketBeat consensus price target is roughly $182, implying about 23% upside from current levels. That said, the beer industry faces meaningful headwinds. A recent Gallup survey found just 54% of Americans report drinking alcohol — the lowest reading on record. Historical patterns show this measure can be cyclical and has rebounded in the past, suggesting the decline may not be structural. A recovery in consumer drinking patterns would be a significant tailwind for Constellation. Given its track record of beer share gains, disciplined margins, and a valuation that still reflects a post-drawdown price, Constellation's outlook currently tilts toward the upside.
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