Brown-Forman Corporation logo

Brown-Forman Corporation

BF-B
52
Beverages - Wineries & Distilleries · Consumer Defensive
Price
$27.01
+0.33 (+1.24%)
Market Cap
$12.60B
Exchange
New York Stock Exchange
Winston Score
52
Winston looking curious
Winston is curious
Mixed quality — meaningful strengths and weaknesses.

Winston Score between 40 and 70. The stock passes some quality checks but not all.

Brown-Forman makes and sells alcoholic beverages, mainly whiskey and other spirits. Its most famous brand is Jack Daniel's Tennessee Whiskey, one of the best-selling American whiskeys in the world. The company also owns Woodford Reserve bourbon, Old Forester, and a handful of tequila and vodka brands, selling to bars, restaurants, liquor stores, and everyday consumers.

Brown-Forman earns money by producing spirits and selling them through distributors to retailers and hospitality businesses around the world. It operates in over 170 countries, with the United States and Europe as its largest markets, and generates roughly $4 billion in annual revenue. Its moat comes from the Jack Daniel's brand, which has strong global recognition built over decades and is difficult for competitors to replicate. The key risk is that premium spirits demand has softened recently as consumers pull back on spending, and the company also faces potential headwinds from tariffs on American whiskey exports to key international markets.

Winston Score History

Score breakdown

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Quality

Gross Margin
60.9%
Premium pricing power — 60.9% gross margin
Operating Margin
32.3%
Excellent — 32.3% operating margin
ROCE
5.0%
Weak — 5.0% return on capital

ROIC between 5% and 15%. They earn 5 to 15 cents back per year on every dollar invested.

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Growth

Sales YoY
-0.5%
Shrinking sales (-0.5% YoY)
EPS YoY
-7.2%
Earnings shrinking (-7.2% YoY)

Slight earnings drop. Typical near a cyclical low.

EPS Consistency
2/8 quarters
Earnings rarely grow — volatile business

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Cash Flow

Cash Conversion
112%
Turns 112% of profit into real cash
FCF Margin
21.6%
Converts sales into free cash efficiently (21.6%)

Free cash flow margin above 20%. Out of every $100 in sales, more than $20 is real cash they keep.

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Stability

Debt / Equity
0.67
Moderate — manageable debt (0.67)
Interest Cover
10.32x
Comfortably covers interest (10.3x)

Interest coverage above 8. Profits cover interest many times over.

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Valuation

P/E Ratio
15.5x
Fair value — P/E 15.5

P/E in the normal range. Price is roughly $15 for every $1 of yearly profit.

P/E vs Forward
+0.1
GROWING
Earnings roughly flat

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Dividends

Dividend Yield
3.47%
Moderate income — 3.47% yield

Standard yield zone for stable dividend payers. A meaningful piece of total return.

Dividend Growth
+2.4%
Dividend flat

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