Filing Flows › Companies › Constellation Brands › Analysis traps
Constellation Brands (STZ): analysis traps
Where its figures could mislead a reader, and what to check before taking them at face value · Data: Q2 FY27, to Aug 31, 2026, filed Oct 7, 2026; rules v1.1
Constellation Brands (STZ): 0 rules of 10 triggered on the filings to Aug 31, 2026. 1 to review; 3 with insufficient data; 2 not applicable. Each is a question to verify, with the normal explanation that would produce the same figures.
Check these first
A precise DCF value = the true value To review · confidence high
The DCF's point value is 182.47 a share (price 141.97); 82% of it is the terminal value, a number about years no one has seen. Moving wacc by ±1 pt alone takes it from 132.04 to 270.07; across every method the research ran the range is 30 to 860. The value is a range; the decimals are not information.
Innocent reading: A stable, mature business with a narrow range of outcomes, where the point value is a fair summary.
Every rule
A01 FCF growth = the business improved Not triggered confidence high
Free cash flow did not rise ($1.9B → $1.8B): the trap does not arise.
The figures and how they are read
| Fiscal year before | FY25 |
| Fiscal year | FY26 |
| Operating cash flow, year before | $3.2B |
| Operating cash flow | $2.7B |
| Capex, year before | $1.2B |
| Capex | $875M |
| Free cash flow, year before | $1.9B |
| Free cash flow | $1.8B |
| Change in FCF | −$144M |
| Change in capex | −$339M |
| Working capital: change in its cash contribution | −$44M |
FCF = operating cash flow − cash capex; ΔFCF = ΔOCF − ΔCapEx; the working-capital part is the change in the cash-bridge items (receivables, inventory, payables, accruals), with the sign of the cash flow statement
Source: FY26 (cash flow statement, fiscal year) · FY25 (cash flow statement, fiscal year before)
A07 Stock compensation added back = no economic cost Insufficient data
fewer than two fiscal years of stock compensation and share counts on file
B02 Receivables growing = future cash is certain Not triggered confidence medium
Receivables grew 2% against revenue 6% in Q2 FY27; DSO 23 against a median of 27: collections are keeping pace with sales.
The figures and how they are read
| Quarter | Q2 FY27 |
| Revenue, year over year | +6.1% |
| Receivables, year over year | +1.6% |
| Quarter before | Q1 FY27 |
| Revenue y/y, quarter before | -3.2% |
| Receivables y/y, quarter before | -10.7% |
| Days sales outstanding | 22.9 |
| DSO, median of eight quarters | 26.6 |
| Receivables | $678M |
| Revenue | $2.8B |
receivables and revenue against the same quarter a year earlier; DSO = receivables / quarterly revenue × days, against the median of the eight quarters before
Source: Q2 FY27 (receivables and revenue) · Q2 FY26 (the same quarter a year earlier)
B08 Adjusted profit = economic profit Insufficient data
no reconciliation table read from the releases yet and fewer than three quarters with both an adjusted and a GAAP EPS
C02 Low net debt = no refinancing risk Not triggered confidence medium
$604M comes due within a year, 3.2× covered by cash and investments of $98M plus $1.8B of free cash flow.
The figures and how they are read
| Cash and investments | $98M |
| Debt | $10.3B |
| Net debt | $10.2B |
| Due within a year | $604M |
| Read from | the debt maturity table |
| Free cash flow, twelve months | $1.8B |
| Cash plus free cash flow | $1.9B |
| Coverage of what is due | 3.2 |
| Due in the second year | $1.8B |
| Balance sheet date | 2026-08-31 |
due within a year from the maturity table (else the current portion of debt), against cash and investments plus free cash flow over the last twelve months (zero if negative); no credit lines assumed
Source: FY26 (debt maturities, cash and investments)
D03 EPS growth = profit growth Insufficient data
no quarter with EPS, net income and diluted shares for both this year and last
E02 Low P/E at a cyclical peak = undervalued Not triggered confidence medium
Net income of $1.9B is not at a cyclical high against the last eight years (median $1.7B, best $3.4B): the P/E of 12.5× is on a normal year.
The figures and how they are read
| market value | $24.0B |
| net income ttm | $1.9B |
| pe ttm | 12.50 |
| net income median fy | $1.7B |
| pe mid cycle | 14.20 |
| net income peak fy | $3.4B |
| years | FY19 / 3436.0; FY20 / -12.0; FY21 / 1998.0; FY22 / -40.0; FY23 / -71.0; FY24 / 1727.0; FY25 / -81.0; FY26 / 1687.0 |
| down years in window | 4 |
P/E on the trailing twelve months' net income against the P/E on the median net income of the last eight fiscal years (a mid-cycle stand-in); 'at a peak' = this year's profit at or above 90% of the best year and at least 1.3× the median
Source: Q2 FY27 (net income, trailing twelve months)
E07 A precise DCF value = the true value To review confidence high
The DCF's point value is 182.47 a share (price 141.97); 82% of it is the terminal value, a number about years no one has seen. Moving wacc by ±1 pt alone takes it from 132.04 to 270.07; across every method the research ran the range is 30 to 860. The value is a range; the decimals are not information.
The figures and how they are read
| dcf value | 182.47 |
| price | 141.97 |
| terminal value share | +81.6% |
| swing by input | WACC / ±1 pt / 132.04 / 270.07; Revenue growth (each year) / ±5 pts / 131.78 / 244.07; Operating margin / ±3 pts / 156.02 / 208.91; Terminal growth / ±0.5 pt / 167.22 / 202.34 |
| range all methods | 29.89; 859.74 |
the DCF's point value against the share of it that is the terminal value and the value at each input moved by one step (growth ±5 pts, WACC ±1 pt, margin ±3 pts …); the range across every method the research ran
Source: 2026-11-08 (valuation research)
What would explain it innocently
- A stable, mature business with a narrow range of outcomes, where the point value is a fair summary
- The inputs that matter most are themselves well known (a regulated return, a long contract)
What to look for in the filing
- Which input you believe differs from the research's and why
- What the price implies for growth (the reverse DCF on the fair-value page)
What would show the trap does not apply
- The DCF's value is robust to the terminal growth and discount rate (the range's low end is still above the price)
- The company's cash flows over the next three years track the DCF's early years
Look again: next filing.
J06 A bank's low P/E and high profit = safe Not applicable
not a bank
J08 A REIT's low net income = the dividend is unsafe Not applicable
not a REIT
What the statuses mean
Triggered: the filings show the pattern; read the normal explanations and the missing evidence before concluding anything. To review: one quarter or a weak signal; a reader's judgement, not a pattern. Not triggered: the pattern is absent on these figures. Insufficient data: the filings read so far do not hold what the rule needs; this is not a clean bill. Not applicable: the rule is not meant for this kind of company (a bank's working capital, a loss-making quarter's EPS growth). Out of date: the latest filing is more than fifteen months old.
Severity is what the pattern could mean for cash, value or solvency; confidence is how reliable the inputs and the reading are. The two are kept apart.
Record a view
A reader's judgement, grounds, what would change it and the next review; kept in the browser (needs JavaScript).
Every rule and the companies it triggers on → Constellation Brands: cash flow →
Each rule reads the company's own filings by a fixed formula and says what would explain the same figures innocently. A triggered rule is a question to verify, not a finding of manipulation, and not a view on the stock. Missing data is shown as missing, never as clear. Not investment advice.