Constellation Brands Inc (NYSE:STZ) shares sank nearly 7% in late-morning trading on Tuesday after the producer of alcoholic beverages reduced its fiscal full-year outlook, citing a “challenging” economy that is hurting its alcohol sales.
The adult beverages giant, which produces popular brands such as Modelo and Corona, also said it is seeing a trend of lower demand from Hispanic consumers in the US, which account for about half of its beer sales.
Constellation Brands had previously stated the decline was caused by Hispanic consumers’ concerns about President Trump’s immigration policies and possible job losses.
“We continue to navigate a challenging macroeconomic environment that has dampened consumer demand and led to more volatile consumer purchasing behavior since our first quarter of fiscal 2026,” Constellation Brands CEO Bill Newlands said in a statement.
“Over the last several months, high-end beer buy rates decelerated sequentially, as both trip frequency and spend per trip declined.”
The company now expects its organic net sales will fall 4% to 6% this year, down from a previous expectation of 1% growth to a 2% pullback.
Meanwhile, Constellation cuts its comparable earnings per share outlook for its fiscal 2026 to a range of $11.30 to $11.60, down from $12.60 to $12.90 previously.
The company also lowered its free cash flow estimate for the year from $1.5 billion to $1.6 billion to $1.3 billion to $1.4 billion.
Constellation Brands shares briefly hit a 52-week low in Tuesday trading and are down about 32% year to date to its current price of $151.50.