One-glance verdict
Undervalued
$59.42 our estimate vs market $26.64
Wall Street consensus: $27.77 (-53.3% lower than our fair-value estimate)
55% below our estimate, below the bear case
Fundamentals snapshot
Brown-Forman Corporation
BF-B · NYQ · Consumer Defensive · Beverages - Wineries & Distilleries
Current price
$26.64
52-week range
$22.61 - $31.92
Market cap
$12.22B
Balance sheet
Watch
11.18x Adequate
Net debt $2.30B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
2 Risks
3 rewards · 2 risks
- Reward Returns 17.8% on equity, ahead of 50% of its peers.
- Reward Free cash flow was positive in 10/10 years.
- Risk Insider ownership is only 2.9% (peer median: 12.9%).
- Risk Operating margin compressed from 26.7% to 23.2% over 3 years.
What this company does
Brown-Forman Corporation
Brown-Forman is an alcohol company that makes and sells famous brands, with Jack Daniel's Tennessee Whiskey being its largest source of income. The company focuses on "premium" spirits, which are more expensive and typically have higher profit margins (the percentage of each sales dollar the company keeps after costs), allowing it to earn more from each bottle sold. This focus on well-known, high-end brands gives the business a stable and profitable foundation.
How the company got here
Founded in 1870 by George Garvin Brown in Louisville, Kentucky, Brown-Forman started with a revolutionary idea: selling whiskey in sealed glass bottles to ensure consistent quality. This focus on quality helped the company survive major challenges, including Prohibition in the 1920s and 30s, by obtaining one of the few licenses to produce whiskey for medicinal purposes. A key turning point was the purchase of the Jack Daniel's Distillery in 1956, which became its most famous and valuable brand, driving much of its global growth. Over the years, the company has expanded its portfolio by acquiring other brands and creating new ones, establishing itself as one of the largest American-owned spirits and wine companies.
What it actually does
Brown-Forman makes, bottles, and sells a wide variety of well-known alcoholic beverages that you would find in a liquor store or at a bar. The company's products are sold in more than 170 countries around the world. You might recognize their flagship brand, Jack Daniel's Tennessee Whiskey, or other popular American whiskeys like Woodford Reserve and Old Forester. They also offer a range of other spirits including tequila, gin, and liqueurs, as well as ready-to-drink cocktails.
Whiskey
This is the heart of Brown-Forman's business, featuring its most iconic brand, Jack Daniel's. This segment includes various American whiskeys like Woodford Reserve and Old Forester, which are different types of bourbon. The company also produces Scotch, Irish, and Canadian whiskies. Whiskey sales, particularly from the Jack Daniel's family of brands, are the main driver of the company's revenue (the total amount of money generated from sales).
Tequila
Brown-Forman has a significant presence in the tequila market with popular brands like Herradura and el Jimador. These tequilas are produced in Mexico and sold globally. This segment caters to the growing popularity of tequila and agave-based spirits. While not as large as their whiskey business, the tequila brands are key contributors to the company's overall sales.
Ready-to-Drink (RTD) & Other Spirits
This part of the business offers pre-mixed cocktails and other convenient beverage options, like the Jack Daniel's & Coca-Cola in a can. This segment also includes a variety of other spirits such as Fords Gin, Diplomático Rum, and Chambord liqueur. The ready-to-drink market is a growing area as consumers look for convenient and easy-to-drink options.
What management is betting on now
The company is heavily focused on "premiumization," which means encouraging customers to buy more high-end and expensive versions of their spirits. They are also investing in their popular ready-to-drink cocktail offerings and expanding their global reach, especially in emerging markets. To become more efficient, management has recently restructured the company, which included reducing its workforce and closing its own barrel-making facility (cooperage) to buy barrels from an outside supplier instead. These moves are intended to save money that can be reinvested to grow their key brands and develop new products.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2025 Q1
$-24.00M
FY2025 Q2
$81.00M
FY2025 Q3
$272.00M
FY2025 Q4
$102.00M
FY2026 Q1
$129.00M
FY2026 Q2
$107.00M
FY2026 Q3
$392.00M
FY2026 Q4
$265.00M
Revenue
$912.00M
Net income
$54.00M
Diluted EPS
0.12
Operating cash flow
$291.00M
Free cash flow
$265.00M
Fetching…
Sources
Revenue
$1.06B
Net income
$267.00M
Diluted EPS
0.58
Operating cash flow
$417.00M
Free cash flow
$392.00M
Fetching…
Sources
Revenue
$1.04B
Net income
$224.00M
Diluted EPS
0.47
Operating cash flow
$132.00M
Free cash flow
$107.00M
Fetching…
Sources
Revenue
$924.00M
Net income
$170.00M
Diluted EPS
0.36
Operating cash flow
$160.00M
Free cash flow
$129.00M
Fetching…
Sources
Revenue
$894.00M
Net income
$146.00M
Diluted EPS
0.31
Operating cash flow
$152.00M
Free cash flow
$102.00M
Fetching…
Sources
Revenue
$1.03B
Net income
$270.00M
Diluted EPS
0.57
Operating cash flow
$317.00M
Free cash flow
$272.00M
Fetching…
Sources
Revenue
$1.09B
Net income
$258.00M
Diluted EPS
0.55
Operating cash flow
$112.00M
Free cash flow
$81.00M
Fetching…
Sources
Revenue
$951.00M
Net income
$195.00M
Diluted EPS
0.41
Operating cash flow
$17.00M
Free cash flow
$-24.00M
Fetching…
Sources
Is it cheap or expensive?
Fair value $59.42 vs current price $26.64
Wall Street consensus is the average analyst price target: $27.77 (-53.3% lower than our fair-value estimate).
Our most-likely fair value is $59.42 a share — about 123.1% above today's price of $26.64, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Watch
Net debt $2.3B. Interest coverage 11.2x.
Net debt
$2.30B
Interest coverage
11.18x
Brown-Forman Corporation's profit covers its interest bill about 11.2 times over. which is stronger than every peer shown here.
Watch
Worse cushion
Baseline
Better cushion
BF-B
BASELINE
Brown-Forman Corporation
Total debt $2.61B Interest coverage 11.18x This is the baseline the peer rows are being compared against.
Total debt $24.29B Interest coverage 3.93x -65% vs BF-B Carries about 2.8x less debt cushion than BF-B.
Total debt $11.20B Interest coverage 7.92x -29% vs BF-B Carries about 1.4x less debt cushion than BF-B.
Total debt $15.60B Interest coverage 5.71x -49% vs BF-B Carries about 2.0x less debt cushion than BF-B.
Total debt $880.88M Interest coverage 4.86x -57% vs BF-B Carries about 2.3x less debt cushion than BF-B.
Total debt $3.09B Interest coverage 5.72x -49% vs BF-B Carries about 2.0x less debt cushion than BF-B.
What you should know
The case for and against BF-B
3 Rewards
2 Risks
Rewards
-
Returns 17.8% on equity, ahead of 50% of its peers.
-
Free cash flow was positive in 10/10 years.
-
Trades at 17.4x P/E vs peer median 18.6x (6.3% cheaper).
Risks
-
Insider ownership is only 2.9% (peer median: 12.9%).
-
Operating margin compressed from 26.7% to 23.2% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
17.41x
Forward P/E
15.60x
P/B
3.04x
P/S
3.11x
EV/EBITDA
12.26x
PEG ratio
4.28x
Profitability
How much profit each dollar creates
Gross margin
60.5%
Operating margin
23.2%
Net margin
18.2%
ROE
17.8%
ROA
8.6%
Health
Liquidity and balance-sheet strength
Debt / equity
0.65x
Current ratio
3.24x
Quick ratio
0.93x
Total debt
$2.61B
Total cash
$308.00M
Growth
How the business has been compounding
Revenue TTM
$3.93B
Revenue 5Y CAGR
-0.0%
EPS TTM
1.53
EPS 5Y CAGR
-2.1%
Cash flow
How much cash the business throws off
Operating CF TTM
$1.00B
Free CF TTM
$893.00M
FCF margin
22.7%
Dividend
Shareholder payout
Yield
3.5%
Payout ratio
59.8%
Last ex-div date
2026-06-10