Constellation Brands is set to announce its earnings on Wednesday, April 9, 2025. Analysts currently expect the company to post earnings of $2.27 per share on revenue of $2.12 billion for the quarter. This marks a slight decline from the same quarter last year, when Constellation reported earnings of $2.26 per share on revenue of $2.14 billion. The small year-over-year drop likely reflects weaker consumption trends, possibly influenced by declining consumer sentiment.
This tougher environment could be a key factor behind the 20% drop in STZ stock so far this year. While the decline partially mirrors broader market weakness, greater economic concerns seem to be exacerbating investor anxiety. Specifically, President Donald Trump’s recent introduction of broad tariffs on imports from over 100 countries has raised fears of a negative impact on the U.S. economy and consumer spending. As a result, this combination of subdued consumer demand and ongoing economic uncertainty presents a difficult backdrop for consumer-oriented companies like Constellation Brands heading into earnings season.
The company currently holds a market cap of $31 billion. Over the last 12 months, it generated $10 billion in revenue and achieved $3.4 billion in operating profit, along with $686 million in net income. While how the company performs relative to expectations will play a major role, studying past patterns may give an edge to event-driven investors. There are two key approaches: assess historical trends and take a position ahead of the earnings release, or evaluate short- and medium-term return correlations post-earnings and act accordingly after results are published. For those seeking gains with less volatility than individual stocks, the Trefis High-Quality portfolio offers a compelling option, having outpaced the S&P 500 with returns of more than 75% since inception.
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Constellation Brands’ Historical Odds Of Positive Post-Earnings Return
Key insights on one-day (1D) post-earnings returns:
- Over the past five years, there have been 19 earnings events, with 7 positive and 12 negative one-day returns. This means a positive return occurred approximately 37% of the time.
- Over the past three years, the frequency of positive one-day returns drops to 27%.
- The median return for the 7 positive events is 2.1%, while the 12 negative events have a median return of -3.3%.
Additional details for 5-Day (5D) and 21-Day (21D) post-earnings returns are provided in the following table.
Correlation Between 1D, 5D, and 21D Historical Returns
One potentially less risky approach—assuming correlations are meaningful—is to study the relationship between short- and medium-term returns after earnings, identify the strongest correlation, and plan trades accordingly. For instance, if the 1D and 5D returns show the highest correlation, then a positive 1D result could justify going “long” for the next 5 days. The following chart includes correlation data based on 5-year and 3-year histories. “1D_5D” denotes the correlation between 1-day returns and the following 5-day period.
Learn more about the Trefis RV strategy, which has outperformed its all-cap stock benchmark (a combination of the S&P 500, S&P MidCap, and Russell 2000) and delivered strong results for investors. Alternatively, for a less volatile option than a single stock like Constellation Brands, you might consider the High Quality portfolio, which has beaten the S&P with over 75% returns since it launched.