Is Brown-Forman Stock Underperforming the S&P 500?

Brown-Forman Corporation (BF-B), headquartered in Louisville, Kentucky, manufactures, distills, bottles, imports, exports, markets, and sells various alcoholic beverages. With a market cap of $16.4 billion, the company provides a range of wines, whiskey spirits, vodkas, tequilas, gin, brandy, rum, bourbons, and liqueurs.

Companies valued at more than $10 billion or more are generally considered “large-cap stocks,” and BF.B fits this criterion perfectly. The leading beverage company benefits from a well-known lineup of its products under the Jack Daniel's, Woodford Reserve, Old Forester, Coopers' Craft, and Gentleman Jack brands.

Despite its strengths, BF.B has faced pressure and has fallen 33.9% from its 52-week high of $52.45, recorded on Mar. 28 last year. BF.B stock has fallen 16.1% over the past three months, lagging behind the broader S&P 500 Index ($SPX), which declined 4.4% during the same period.

Over the past six months, shares of BF.B declined 25.3%, compared to $SPX’s marginal decline. Moreover, BF.B has fallen 32.9% over the past 52 weeks, underperforming SPX's 8.1% return.

BF.B has dipped below its 200-day moving average since the end of Octoberbut has been trading above its 50-day moving average since early-March.

BF.B stock surged 10.1% following its Q3 earnings release on Mar. 5. The company reported a 3% decline in its sales, which amounted to $1 billion. However, the company expects a 2 to 4% increase in its sales and its organic operating income for the fiscal year. Additionally, its EPS came in at $0.57, surpassing the Wall Street estimates by 21.3%.

Its rival, MGP Ingredients, Inc. (MGPI), has also declined over the past year, with its shares falling 64.8% over the past six months and 65% over the past 52 weeks.

BF.B has a consensus rating of “Hold” from 16 analysts in coverage. Its mean price target of $40.78 represents an upside of 17.7% from the current market prices.