Brown-Forman faces risks from fluctuating foreign currency exchange rates, commodity prices, and interest rates. Competition, including pricing actions and new entrants, poses a threat. Distribution network disruptions, inventory fluctuations, and changing consumer preferences (including potential declines in spirits consumption) are also noted risks. Economic downturns, political instability, and legal disputes are additional concerns. The company also faces risks related to acquisitions, divestitures, and investments.
Financial Upside
Brown-Forman anticipates organic net sales and operating income growth in fiscal 2025, driven by international market gains and normalizing inventory trends. Strong cash flows from operations, investment-grade credit ratings, and a $900 million commercial paper program provide financial flexibility. The company expects to meet its short-term and long-term financial commitments. A potential acquisition of Duckhorn could also provide a positive outcome.
