The largest importers of Mexican beer and tequila to the US are at risk of a double-digit hit to earnings owing to the Trump administration’s proposed tariffs, according to Wall Street analysts.
Constellation Brands, which produces Modelo Especial, the US’s top-selling beer, and Corona, could take a 33 per cent earnings hit to earnings, according to analysis by Bernstein. Citi analysts estimated the earnings hit to the company, which also owns the Mi Campo and Casa Noble tequila brands, would be a slightly lower 25 per cent.
Becle-owned Cuervo, one of Mexico’s oldest and largest tequila producers, which ships brands such as Jose Cuervo, 1800 and Gran Coramino to the US, faced a 30 per cent income hit, Bernstein said.
The analysts cautioned that companies would struggle to raise prices while demand for alcohol in the US was so weak.
Source: Economy - ft.com
