Constellation Brands, Inc. (STZ)’s “A Terrible Stock,” Says Jim Cramer

We recently published 12 Latest Stocks Jim Cramer Discussed. Constellation Brands, Inc. (NYSE:STZ) is one of the stocks Jim Cramer recently discussed.

Alcoholic beverage producer Constellation Brands, Inc. (NYSE:STZ)’s shares have lost 24% year-to-date as they are yet to recover from a massive 17% dip in January. The shares fell at the start of the year after the firm missed analyst revenue and EPS estimates for its fiscal third quarter and cut its fiscal year guidance. Cramer’s previous remarks about Constellation Brands, Inc. (NYSE:STZ) have discussed the impact of GLP-1 drugs and dropping alcohol consumption on the stock. Here are his latest thoughts:

“In this country we once had prohibition, I’m beginning to think we now have self-prohibition. There’s a Gallup poll, talking about American self-reported drinking down 54% after consecutive declines. Believe moderate drinking is bad for health. The Gen Zs aren’t drinking. . . .Beer remains America’s favorite booze, I’m not going to go into beer stocks, I think Constellation’s, STZ’s, a terrible stock. . . .Because this is a mocktail era. People are, I mean it really is temperance. And there are a lot of people who feel that even red wine, they finally got rid of that canard. So be careful in the liquor story because its just not getting better, it’s getting worse.”

Cramer wasn’t optimistic about Constellation Brands, Inc. (NYSE:STZ) ahead of its latest earnings either:

“On Tuesday, we get results from former market darling, Constellation Brands. What a fallen idol. There’s so much to unpack here because this consumer packaged goods company is a microcosm of what’s gone wrong with this now pathetic group that used to be the place to go when there’s a slowdown. First: Constellation is an alcohol company, so all their products are being hurt by the GLP-1 drugs, which can blunt your craving for booze. That’s especially true for the big beers, which are Modelo [and] Corona, and then a new popular favorite, Pacifico.

Photo by Zhivko Minkov on Unsplash

Second: Increasingly, surveys show that there’s a switch from beer to cannabis because smoking weed is theoretically less fattening. I say theoretically because while alcohol has way more calories, it doesn’t give you the munchies. This younger generation cares more about their health than previous ones. Sounds fanciful, but it is true. Third: Constellation said its sales have been hurt by concerns in the Hispanic community about mass deportations. The stock’s been steadily declining all quarter.

It’s been downgraded by analysts jumping ship from the company that used to beat and raise and beat and raise over and over and over again. Used to be a big position for my trust. That was then. Now, we expect Constellation to miss. We’ll get the results Tuesday night, and the conference call will start on Wednesday morning. You’ll probably see the stock jump up when it reports. That’s what it typically does, and then it declines through the rest of the day. So let’s be careful.”

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Disclosure: None. This article is originally published at Insider Monkey.