Story updated at 9:55 a.m. to reflect market activity.
Shares of Constellation Brands fell 1% to $81.70 in morning trading.
The bank raised its price target for the wine, beer, and spirits producer to $88 from $84 despite the downgrade. Analyst Judy Hong says the owner of the Svedka brand of vodka lacks any near-term catalysts.
"We are downgrading shares of Constellation Brands to Neutral from Buy, as our EPS estimate gap versus consensus has narrowed, valuation is full, and our price target now shows only 6% upside in 12-months," Hong wrote. "We are lowering our EPS by 2% in FY15/16 as we make beer packaging savings more back-end loaded."
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Separately, TheStreet Ratings team rates CONSTELLATION BRANDS as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:
"We rate CONSTELLATION BRANDS (STZ) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its robust revenue growth, notable return on equity, reasonable valuation levels, solid stock price performance and compelling growth in net income. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."