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    Reassessing Brown-Forman (BF.B) Valuation After Canadian Boycott Drives Forecast Net Sales Decline

    Simply Wall St·12/11/2025 22:27:38
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    Brown-Forman (BF.B) is wrestling with an unusual problem, a deep Canadian boycott of U.S. spirits that has driven local sales down about 62%, forcing management to guide for a modest full year net sales decline.

    See our latest analysis for Brown-Forman.

    Despite the Canada hit and softer quarterly earnings, Brown-Forman shares have shown a 30 day share price return of 11.0% and a 90 day share price return of 12.25%. However, the 1 year total shareholder return of negative 29.22% and 5 year total shareholder return of negative 56.90% underline how long term momentum has clearly faded.

    If you are reassessing your consumer staples exposure after Brown-Forman's slide, it could be a smart moment to explore fast growing stocks with high insider ownership.

    With earnings under pressure, a completed buyback, and the stock trading close to analyst targets but at a sizable discount to some intrinsic estimates, is Brown-Forman a contrarian value play, or is the market already discounting its future growth?

    Most Popular Narrative: 10% Undervalued

    Brown-Forman's most followed narrative implies a fair value just above the latest close of $30.88, suggesting the recent rebound still leaves upside on the table.

    The ongoing trend towards premium and craft spirits among younger, urban consumers is being addressed through innovation (e.g., launches like Jack Daniel's Tennessee Blackberry and focus on super premium whiskeys), which should lift average selling prices, gross margins, and drive long-term earnings growth.

    Read the complete narrative.

    Curious how modest top line assumptions and only a slight margin shift can still justify a richer earnings multiple in a slow growth category? The narrative spells out the precise growth, profitability, and valuation bridges behind that call. Want to see how those moving parts add up to today’s fair value target?

    Result: Fair Value of $30.91 (UNDERVALUED)

    Have a read of the narrative in full and understand what's behind the forecasts.

    However, persistent developed market weakness and rising low or no alcohol alternatives could cap volumes and undermine premiumization benefits and the multiple expansion this thesis assumes.

    Find out about the key risks to this Brown-Forman narrative.

    Build Your Own Brown-Forman Narrative

    If you would rather stress test the assumptions yourself and build a different view from the ground up, you can create a fresh narrative in under 3 minutes: Do it your way.

    A great starting point for your Brown-Forman research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.