Constellation Brands Inc ( STZ ) shares are trading lower after the company reported nearly flat third-quarter sales of $2.46 billion, missing the analyst consensus estimate of $2.53 billion.

Net sales for the Beer segment increased 3% Y/Y to $2.03 billion, and Wine and Spirits declined 14% to $431.4 million. Shipment volume for Beer climbed 1.6%, while Wine and Spirits declined 16.4%.

Gross profit increased 1% to $1.28 billion, and the operating income slid 0.4% to $793 million. The operating margin for the quarter was 32.2%.

Comparable EPS of $3.25 missed the analyst consensus estimate of $3.31.

The company generated year-to-date operating cash flow of $2.6 billion, a 9% increase, and free cash flow of $1.6 billion, a 13% growth.

Constellation Brands ( STZ ) ended the quarter with $73.7 million in cash and equivalents as of November 30, 2024.

Constellation’s board declared a quarterly cash dividend of $1.01 per share, payable on February 21, to stockholders of record on February 7.

“While we continue to face the subdued spend and value seeking behaviors that emerged among legal drinking age consumers in Q2, our Beer Business delivered a sequential increase in our depletions growth rate in Q3,” said President and CEO Bill Newlands.

Guidance: Constellation Brands ( STZ ) lowered FY25 net sales growth outlook to 2% – 5% from 4% – 6%. It also lowered Comparable EPS guidance to $13.40 – $13.80 from $13.60 – $13.80 against an estimate of $13.71.

Constellation Brands ( STZ ) currently sees an operating cash flow of $2.9 billion – $3.1 billion and a free cash flow of $1.6 billion – $1.8 billion.

Price Action: STZ shares are trading lower by 4.46% at $209.50 in premarket on the last check Friday.