STZ vs. TAP: Which Beer Stock Will Actually Grow Your Retirement Income?
Both beer stocks are beaten down, but one has a dividend history that should make retirees nervous and a business trajectory that makes the yield look like a trap. The stronger income pick for the next 20 years is not…
Constellation Brands (NYSE:STZ | STZ Price Prediction) or Molson Coors (NYSE:TAP): which beer maker offers the stronger income profile for those building retirement income right now? Both stocks are down this year, Constellation by 9.22% and Molson Coors by 17.7%. Both sell beer into a U.S. market that Molson Coors estimates shrank 4.2% last quarter. After that, the two companies head in opposite directions. Constellation just reported fiscal second-quarter revenue up 6.1% year over year. Molson Coors is guiding 2026 underlying EPS down 11% to 15%.
Yield and Valuation: Molson Coors Takes This Round
Molson Coors pays an annualized forward dividend of $1.92 per share. At $37.14, that is a yield of about 5.2%. Constellation’s $4.12 forward dividend at $122.60 yields about 3.4%. Molson Coors trades near 7 times its 2025 underlying EPS of $5.42, while Constellation trades at a forward P/E of 10.
Coverage also favors Molson Coors on paper. Its 2025 free cash flow of $1.14 billion covered $376.3 million in dividends about 3 times. Constellation’s $1.79 billion in FY2026 free cash flow covered $715.7 million in dividends about 2.5 times. Molson Coors carries lower leverage too, at 2.53x net debt to EBITDA versus 3.38x. For cash per dollar invested today, Molson Coors wins.
Growth Trajectory: Constellation Brands Pulls Away
Molson Coors earned its low multiple. Second-quarter revenue fell 3.3%, financial volume dropped 5.4%, and net income declined 45.95%. Management acknowledged, “Our share performance is not yet where we want it to be and cost inflation remains significant.” Aluminum premium inflation alone should top $130 million this year. Operating cash flow fell from $2.079 billion in 2023 to $1.784 billion in 2025.
Constellation is gaining ground. Beer net sales rose 5% to $2.47 billion, shipments grew 5.5%, and the company was the top dollar and volume share winner in beverage alcohol. Pacifico is growing at roughly 20% year to date. Weak spots remain: Modelo Especial depletions fell 2% and Corona Extra 5%. Still, CEO Nick Fink said “We feel really good about the trajectory,” and management expects the high end of its $11.20 to $11.90 comparable EPS range if September trends hold. Dividends follow earnings over time, and only one of these companies is growing them.
Dividend Track Record: Constellation Brands Wins Decisively
Constellation’s quarterly dividend rose from $0.31 in 2015 to $1.03 today, with no cuts in that record. The latest raise was a modest 1%, as management leaned on buybacks totaling $530 million year to date while handling a CEO transition and tariff exposure on Mexican production.
Molson Coors has paid for decades, but its record includes a cut from $0.57 per quarter in 2019 and 2020 to $0.34 in 2021. It has rebuilt to $0.48, yet the latest raise was a single cent from $0.47. It also took a $3.65 billion Americas goodwill impairment in late 2025. A dividend already cut once under pressure deserves a discount from retirees.
Verdict: Constellation Brands Owns the Dividend Built to Last
Molson Coors pays more today, and an investor who needs maximum cash over the next two or three years will collect more from it. That yield sits on a business with shrinking volume, revenue, and earnings, and holders have paid for it: shares fell 55.87% over 10 years versus 15.83% for Constellation.
Constellation comes out on top for the retirement investor. Its 3.4% yield rests on a growing beer franchise, a decade of consecutive raises in the record, and guided FY2027 free cash flow of $1.6 billion to $1.7 billion. For income that has to keep rising for 20 years, it has the stronger dividend profile (the whole point of a dividend ladder is never having to sell a share, and we laid out how to build one in a free guide here). Keep an eye on the stock around Modelo and Corona depletion trends and the Veracruz brewery, which management expects online at the start of fiscal 2028.
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Chris Lange is a financial and geopolitical writer with more than a decade of experience covering a myriad of topics. He has published thousands of articles for 24/7 Wall St., with past coverage focused heavily on stocks, IPOs, healthcare, defense, global affairs, and technology.
His work has been quoted, or referenced by a number of outlets including Business Insider, USA Today, Yahoo Finance, MSN, The Motley Fool, and many other publications. A graduate of Southwestern University, he studied business with a focus on investments and has previous experience in banking and startups.
When not reading or writing the news, he is following his passion for Lacrosse, playing chess, or building solar projects with his dad.
