Constellation Brands' (STZ) lowered fiscal 2026 guidance due to consumer demand headwinds had largely been anticipated by investors, but the magnitude of the change was "worse than expected," Needham said in a note Wednesday.

The brokerage said the updated outlook reflects a major shift in tone compared with fiscal Q1, when the company kept its guidance.

At that time, Constellation Brands was also confident that beer volumes would go back to growth in fiscal Q2 even though reads on consumer offtake in June were weak, Needham said.

The firm said the company's announcement was "disappointing" but the guidance "now looks to be readily achievable."

Needham cut its price target on the company to $180 from $200 and maintained its buy rating.

Shares of Constellation Brands were down 2.8% in recent trading.

Price: 147.59, Change: -3.67, Percent Change: -2.43