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BF.B Q4 Earnings Miss Estimates, Sales Beat on Pricing and Innovation
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Key Takeaways
BF.B's Q4 EPS fell 62% to $0.12, missing the $0.33 estimate, while sales rose 2% YoY to $912M.
Brown-Forman's gross margin widened 530 bps to 58.9%, but SG&A jumped 34% and operating income fell 53%.
BF.B sees FY27 organic sales roughly flat and organic operating income down 3-5% amid macro pressure.
Brown-Forman Corporation (BF.B - Free Report) posted fourth-quarter fiscal 2026 results, wherein the bottom line missed the Zacks Consensus Estimate and declined year over year. However, the top line surpassed the estimates and increased year over year. In the fiscal fourth quarter, earnings per share (EPS) of 12 cents plunged 62% year over year and lagged the Zacks Consensus Estimate of 33 cents.
Brown-Forman Corporation Price, Consensus and EPS Surprise
Net sales of $912 million jumped 2% on a reported basis and beat the Zacks Consensus Estimate of $876 million. On an organic basis, net sales edged up 2% from the prior-year period.
This Zacks Rank #4 (Sell) company’s shares have lost 15.6% in the past six months against the industry’s 11.9% growth.
BF.B Stock's Price Performance
Image Source: Zacks Investment Research
Brown-Forman’s Q4 Margins & Expenses
In the fiscal fourth quarter, BF.B’s gross profit of $571 million jumped 11% year over year on a reported basis and rose 10% on an organic basis. Also, the gross margin expanded 530 basis points (bps) to 62.6%, aided by the effect of acquisitions and divestitures.
Selling, general and administrative (SG&A) expenses of $259 million were up 34% year over year.
Operating income fell 53% year over year to $96 million on a reported basis and was flat on an organic basis. The operating margin of 10.5% contracted 1240 bps from the year-ago quarter.
Understanding Brown-Forman’s Market Performance
In fiscal 2026, the company’s net sales declined 1% on a reported basis and were flat on an organic basis.
Net sales in the United States decreased 7% year over year on a reported basis and were flat on an organic basis in the fiscal year, reflecting the end of the Korbel relationship and the absence of the Sonoma-Cutrer prior-year TSA, weak volumes of Jack Daniel’s Tennessee Whiskey and unfavorable portfolio mix. These pressures were partly offset by innovation, led by Jack Daniel’s Tennessee Blackberry and continued growth in Woodford Reserve. Price increases across the portfolio tied to revised distributor terms, along with favorable timing of distributor orders, provided an additional lift to net sales.
In a challenging economic landscape, net sales in the Developed International markets were flat on a reported basis and declined 3% on an organic basis.The benefit from favorable currency translation and the shift to owned distribution in Italy was essentially offset by the lack of American-made spirits on shelves across most Canadian provinces, along with sales declines in Germany and the United Kingdom.
Net sales in Emerging markets increased 14% on a reported basis and 12% on an organic basis, backed by solid double-digit growth of New Mix, increased volumes across the Jack Daniel’s family of brands in Brazil and Türkiye, an expected net increase in distributor inventories, and a favorable foreign exchange impact.
The Travel Retail channel’s net sales jumped 6% on a reported basis and 5% on an organic basis, owing to increased passenger traffic leading to solid volumes of Jack Daniel’s Tennessee Whiskey and the positive impact of foreign exchange.
A Peek at BF.B’s Brand Performance
During fiscal 2025, net sales for Whiskey products rose 3% on a reported basis and 1% organically, driven by the launch of Jack Daniel’s Tennessee Blackberry, a favorable foreign exchange impact and continued growth of Woodford Reserve in the United States. These gains were partly offset by declines in Jack Daniel’s Tennessee Whiskey.
Net sales for the Tequila portfolio dipped 4% on a reported basis and 6% on an organic basis. Herradura’s net sales dipped 9% on a reported basis and 10% on an organic basis due to soft volumes in the United States. el Jimador’s net sales inched down 2% on a reported basis and 2% on an organic basis, caused by decreases in the United States and Mexico, partly offset by increased volumes in Colombia.
Net sales for the Ready-to-Drink (RTD) portfolio rose 11% on a reported basis and 7% on an organic basis. Net sales of New Mix surged 41% on a reported and 33% on an organic basis, bolstered by market share gains in Mexico in an accelerating category and the product’s launch in the United States. Jack Daniel’s RTD/RTP portfolio dipped 3% on a reported basis and 5% on an organic basis, thanks to the absence of American-made beverage alcohol from retail shelves across the majority of provinces in Canada and soft volumes in the United States.
Rest of Portfolio's net sales declined 31% on a reported basis but jumped 18% on an organic basis, thanks to the unfavorable impact of acquisitions and divestitures, somewhat offset by the distribution of new agency brands in Japan and Mexico, and double-digit growth of Gin Mare and Diplomático.
Net sales for non-branded and bulk fell 68% on a reported and organic basis, caused by soft used barrel sales.
BF.B’s Financial Health Snapshot
The company ended fiscal 2026 with cash and cash equivalents of $308 million and long-term debt of $2.1 billion. Its total shareholders’ equity was $4 billion. As of April 30, 2026, BF.B had $71 million in cash outflow from operating activities and free cash flow of $893 million.
On May 28, 2026, the company’s board declared a regular cash dividend of $0.2310 per share on its class A and class B common stock, payable July 1, to its stockholders of record as of June 10. Brown-Forman paid regular quarterly cash dividends for 82 straight years while hiking the regular dividend for 42 consecutive years. The company returned $400 million to its stockholders through its share repurchase program, which was completed in December 2025, alongside $427 million paid in regular quarterly dividends during fiscal 2026.
What’s Ahead for BF.B in FY27?
Brown-Forman expects the operating backdrop in fiscal 2027 to stay tough, with macro pressures and geopolitical uncertainty continuing to weigh on consumer demand for beverage alcohol, especially in developed markets. Still, the company plans to focus on controllable levers and believes it will benefit from its restructuring actions, U.S. distributor changes and ongoing innovation, including the broader rollout of Jack Daniel’s Tennessee Blackberry. Accordingly, management sees organic net sales roughly flat, organic operating income down 3-5%, an effective tax rate of about 20-22% and capital spending of $60-$70 million.
Stocks to Consider
Vita Coco Company (COCO - Free Report) is a global beverage company best known for its Vita Coco coconut water brand, with a diversified portfolio spanning coconut-based products, plant-based alternatives, functional drinks and private-label offerings across retail, e-commerce and foodservice channels. COCO currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Vita Coco’s 2026 sales and earnings indicates growth of 21.4% and 47.9%, respectively, from the year-ago reported numbers. The company delivered a trailing four-quarter earnings surprise of 11.7%, on average.
Tyson Foods, Inc. (TSN - Free Report) operates as a food company worldwide. It operates through four segments: Beef, Pork, Chicken and Prepared Foods. TSN currently sports a Zacks Rank #1. TSN delivered a trailing four-quarter earnings surprise of 15.6%, on average.
The Zacks Consensus Estimate for Tyson Foods’ current fiscal-year sales and earnings indicates growth of 13.8% and 36.3%, respectively, from the year-ago reported numbers.
Fomento Economico Mexicano (FMX - Free Report) participates in the beverage industry through Coca-Cola FEMSA, which is the world’s largest franchise bottler for Coca-Cola products. FMX currently flaunts a Zacks Rank #1.
The Zacks Consensus Estimate for FMX’s 2026 sales and earnings suggests growth of 17.5% and 115.3%, respectively, from the year-ago reported figures. The company delivered a trailing four-quarter negative earnings surprise of 17%, on average.
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BF.B Q4 Earnings Miss Estimates, Sales Beat on Pricing and Innovation
Key Takeaways
Brown-Forman Corporation (BF.B - Free Report) posted fourth-quarter fiscal 2026 results, wherein the bottom line missed the Zacks Consensus Estimate and declined year over year. However, the top line surpassed the estimates and increased year over year. In the fiscal fourth quarter, earnings per share (EPS) of 12 cents plunged 62% year over year and lagged the Zacks Consensus Estimate of 33 cents.
Brown-Forman Corporation Price, Consensus and EPS Surprise
Brown-Forman Corporation price-consensus-eps-surprise-chart | Brown-Forman Corporation Quote
Net sales of $912 million jumped 2% on a reported basis and beat the Zacks Consensus Estimate of $876 million. On an organic basis, net sales edged up 2% from the prior-year period.
This Zacks Rank #4 (Sell) company’s shares have lost 15.6% in the past six months against the industry’s 11.9% growth.
BF.B Stock's Price Performance
Image Source: Zacks Investment Research
Brown-Forman’s Q4 Margins & Expenses
In the fiscal fourth quarter, BF.B’s gross profit of $571 million jumped 11% year over year on a reported basis and rose 10% on an organic basis. Also, the gross margin expanded 530 basis points (bps) to 62.6%, aided by the effect of acquisitions and divestitures.
Selling, general and administrative (SG&A) expenses of $259 million were up 34% year over year.
Operating income fell 53% year over year to $96 million on a reported basis and was flat on an organic basis. The operating margin of 10.5% contracted 1240 bps from the year-ago quarter.
Understanding Brown-Forman’s Market Performance
In fiscal 2026, the company’s net sales declined 1% on a reported basis and were flat on an organic basis.
Net sales in the United States decreased 7% year over year on a reported basis and were flat on an organic basis in the fiscal year, reflecting the end of the Korbel relationship and the absence of the Sonoma-Cutrer prior-year TSA, weak volumes of Jack Daniel’s Tennessee Whiskey and unfavorable portfolio mix. These pressures were partly offset by innovation, led by Jack Daniel’s Tennessee Blackberry and continued growth in Woodford Reserve. Price increases across the portfolio tied to revised distributor terms, along with favorable timing of distributor orders, provided an additional lift to net sales.
In a challenging economic landscape, net sales in the Developed International markets were flat on a reported basis and declined 3% on an organic basis.The benefit from favorable currency translation and the shift to owned distribution in Italy was essentially offset by the lack of American-made spirits on shelves across most Canadian provinces, along with sales declines in Germany and the United Kingdom.
Net sales in Emerging markets increased 14% on a reported basis and 12% on an organic basis, backed by solid double-digit growth of New Mix, increased volumes across the Jack Daniel’s family of brands in Brazil and Türkiye, an expected net increase in distributor inventories, and a favorable foreign exchange impact.
The Travel Retail channel’s net sales jumped 6% on a reported basis and 5% on an organic basis, owing to increased passenger traffic leading to solid volumes of Jack Daniel’s Tennessee Whiskey and the positive impact of foreign exchange.
A Peek at BF.B’s Brand Performance
During fiscal 2025, net sales for Whiskey products rose 3% on a reported basis and 1% organically, driven by the launch of Jack Daniel’s Tennessee Blackberry, a favorable foreign exchange impact and continued growth of Woodford Reserve in the United States. These gains were partly offset by declines in Jack Daniel’s Tennessee Whiskey.
Net sales for the Tequila portfolio dipped 4% on a reported basis and 6% on an organic basis. Herradura’s net sales dipped 9% on a reported basis and 10% on an organic basis due to soft volumes in the United States. el Jimador’s net sales inched down 2% on a reported basis and 2% on an organic basis, caused by decreases in the United States and Mexico, partly offset by increased volumes in Colombia.
Net sales for the Ready-to-Drink (RTD) portfolio rose 11% on a reported basis and 7% on an organic basis. Net sales of New Mix surged 41% on a reported and 33% on an organic basis, bolstered by market share gains in Mexico in an accelerating category and the product’s launch in the United States. Jack Daniel’s RTD/RTP portfolio dipped 3% on a reported basis and 5% on an organic basis, thanks to the absence of American-made beverage alcohol from retail shelves across the majority of provinces in Canada and soft volumes in the United States.
Rest of Portfolio's net sales declined 31% on a reported basis but jumped 18% on an organic basis, thanks to the unfavorable impact of acquisitions and divestitures, somewhat offset by the distribution of new agency brands in Japan and Mexico, and double-digit growth of Gin Mare and Diplomático.
Net sales for non-branded and bulk fell 68% on a reported and organic basis, caused by soft used barrel sales.
BF.B’s Financial Health Snapshot
The company ended fiscal 2026 with cash and cash equivalents of $308 million and long-term debt of $2.1 billion. Its total shareholders’ equity was $4 billion. As of April 30, 2026, BF.B had $71 million in cash outflow from operating activities and free cash flow of $893 million.
On May 28, 2026, the company’s board declared a regular cash dividend of $0.2310 per share on its class A and class B common stock, payable July 1, to its stockholders of record as of June 10. Brown-Forman paid regular quarterly cash dividends for 82 straight years while hiking the regular dividend for 42 consecutive years. The company returned $400 million to its stockholders through its share repurchase program, which was completed in December 2025, alongside $427 million paid in regular quarterly dividends during fiscal 2026.
What’s Ahead for BF.B in FY27?
Brown-Forman expects the operating backdrop in fiscal 2027 to stay tough, with macro pressures and geopolitical uncertainty continuing to weigh on consumer demand for beverage alcohol, especially in developed markets. Still, the company plans to focus on controllable levers and believes it will benefit from its restructuring actions, U.S. distributor changes and ongoing innovation, including the broader rollout of Jack Daniel’s Tennessee Blackberry. Accordingly, management sees organic net sales roughly flat, organic operating income down 3-5%, an effective tax rate of about 20-22% and capital spending of $60-$70 million.
Stocks to Consider
Vita Coco Company (COCO - Free Report) is a global beverage company best known for its Vita Coco coconut water brand, with a diversified portfolio spanning coconut-based products, plant-based alternatives, functional drinks and private-label offerings across retail, e-commerce and foodservice channels. COCO currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Vita Coco’s 2026 sales and earnings indicates growth of 21.4% and 47.9%, respectively, from the year-ago reported numbers. The company delivered a trailing four-quarter earnings surprise of 11.7%, on average.
Tyson Foods, Inc. (TSN - Free Report) operates as a food company worldwide. It operates through four segments: Beef, Pork, Chicken and Prepared Foods. TSN currently sports a Zacks Rank #1. TSN delivered a trailing four-quarter earnings surprise of 15.6%, on average.
The Zacks Consensus Estimate for Tyson Foods’ current fiscal-year sales and earnings indicates growth of 13.8% and 36.3%, respectively, from the year-ago reported numbers.
Fomento Economico Mexicano (FMX - Free Report) participates in the beverage industry through Coca-Cola FEMSA, which is the world’s largest franchise bottler for Coca-Cola products. FMX currently flaunts a Zacks Rank #1.
The Zacks Consensus Estimate for FMX’s 2026 sales and earnings suggests growth of 17.5% and 115.3%, respectively, from the year-ago reported figures. The company delivered a trailing four-quarter negative earnings surprise of 17%, on average.