Treasury Wine Estates Ltd (ASX: TWE) shares are falling again on Thursday.
At the time of writing, the wine giant's shares are down 6% to $4.68.
This means they are now down 58% since the start of the year.
Is this a buying opportunity for investors? Let's see what analysts at Macquarie Group Ltd (ASX: MQG) are saying about this fallen giant.
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What is the broker saying about Treasury Wine shares?
Like everyone, Macquarie was disappointed with Treasury Wine's update this week.
It notes that its guidance implies a sharp decline in earnings for the first half of FY 2026. It said:
At the result in Aug-25, TWE guided to EBITS growth in FY26E, driven by low-to-mid-teens growth in Penfolds. In Oct-25, guidance was withdrawn, citing the uncertain outlook for Penfolds and Treasury Americas. The midpoint of 1H26E guidance provided today implies a ~40% decline vs. pcp. The ongoing lowering of earnings forecasts in a short period of time suggests the lack of earnings visibility for the group. Positively, the new CEO has taken a more conservative view with respect to right-sizing inventory in the key China and US markets.
But it certainly isn't game over for Treasury Wine. Macquarie believes there is still inherent value in the key Penfolds brand and thinks that the company's decision to right-size its inventory is a smart move. It adds:
We agree with management there is inherent value in the Penfolds brand, particularly in the luxury/ultraluxury tiers. Maintaining this luxury status as distributors right-size inventories and discount to reduce stock will see the business in a stronger position long-term, contingent on managing concerns noted above.
Should you buy Treasury Wine shares?
Macquarie isn't in a rush to buy the company's shares just yet despite their heavy decline.
According to the note, the broker has retained its neutral rating on them with a reduced price target of $5.00.
This implies potential upside of approximately 7% for investors from current levels.
Commenting on its recommendation, Macquarie said:
Retain Neutral. Management's focus on right-sizing inventories to more closely reflect demand while also seeking to reduce leverage are critical, albeit from a challenging startpoint. Risks will remain elevated in the near term, however there is opportunity on execution.
Valuation: TP reduces ~22% to $5.00 consistent with cashflow changes. Catalysts: Wine Australia export data (monthly); Chinese consumption trends and Government policy; Industry commentary on depletions in China and the US.
