Update shared on27 Sep 2025
Fair value Decreased 1.11%Brown-Forman’s consensus price target saw a slight downward revision to $30.91, as analysts cite persistent sales softness in major markets and continued spirits industry weakness, partly offset by improving cash conversion and supportive valuation.
Analyst Commentary
- Ongoing weakness in the U.S. spirits industry, excluding prepared cocktails, with a sustained 3%-4% market decline and uncertain timeline for recovery.
- Post-earnings caution persists as sales trends remain soft in both the U.S. and European markets, with Q2 anticipated to be more challenging due to phasing effects.
- Bullish analysts cite peer valuation rerating, a two-month valuation roll-forward, and current share valuation providing some support.
- Despite a broadly negative outlook for near-term organic sales, some analysts highlight Brown-Forman's compelling international growth opportunities.
- Company cash conversion is expected to improve as its latest investment cycle concludes, and valuation is viewed as attractive at current levels.
What's in the News
- Brown-Forman is among the major alcohol companies positioning to enter the cannabis beverage market, focusing on opportunities from federally legal hemp-derived THC (Reuters).
- The company was added to the FTSE All-World Index in September 2025 (Key Developments).
- Brown-Forman reiterated its earnings guidance for fiscal year 2026, expecting organic net sales and organic operating income to decline in the low-single digit range (Key Developments).
- CFO Leanne Cunningham will retire in May 2026 after over 30 years at the company, having served as CFO since 2021 and previously leading several finance and strategy functions (Key Developments).
- The expansion into cannabis beverages and index inclusion comes amid modest near-term financial expectations and planned executive leadership change (Reuters; Key Developments).
Valuation Changes
Summary of Valuation Changes for Brown-Forman
- The Consensus Analyst Price Target remained effectively unchanged, moving only marginally from $31.26 to $30.91.
- The Future P/E for Brown-Forman remained effectively unchanged, moving only marginally from 20.68x to 20.45x.
- The Consensus Revenue Growth forecasts for Brown-Forman remained effectively unchanged, at 1.5% per annum.
Disclaimer
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