Investors are betting alcohol companies are among the winners of last night's midterm election landslide, based on expectations that a new Congress will push back on the Trump administration's immigration and trade policies that have weighed on booze businesses. Constellation Brands Inc., which sells Modelo and Corona beer brands in the US, rose as much as 7.4% Wednesday, its biggest gain since April. Boston Beer Co., Brown-Forman Corp. and Molson Coors Beverage Co. also jumped. The potential for changes to immigration policing and tariffs on key markets including Canada offers a rare bright spot for an industry struggling with lower consumption in the US.
Bank of America analyst Peter Galbo raised his recommendation on Constellation, citing an improved immigration environment. "We now believe Democratic control of Congress reduces the risk of further tightening in the immigration backdrop," he wrote in a note. Hispanic consumers account for around 40% of the company's US beer business, and tighter immigration policies have reduced that population through border control and fewer social gatherings, Galbo wrote.
Shares of Brown-Forman rose on the possibility that tensions between the US and Canada could ease. The maker of Jack Daniel's whiskey has been largely shut out of Canada as provinces pulled US labels in response to President Trump's tariffs. TD Cowen analyst Seamus Cassidy said a reversal in trade tensions would be a "pretty significant offset" to sales weakness. Spirits sales to Canada have fallen 70%, from $232 million to $72 million since 2025, according to the Distilled Spirits Council of the United States.
Overall, the share of Americans who say they drink remains at historic lows, though average beverage consumption inched higher this year, according to a recent Gallup poll. Alcohol spending also hit record lows last year amid economic strain and growing demand for alternatives such as THC-infused drinks.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing