Treasury Wine Estates Ltd (ASX: TWE) shares are marching higher today.
Shares in the S&P/ASX 200 Index (ASX: XJO) global wine company closed yesterday trading for $4.95. In early afternoon trade on Tuesday, shares are changing hands for $5.035 apiece, up 1.7%.
For some context, the ASX 200 is up 0.8% at this same time.
As you're likely aware (or should be if you read the headline!), today's outperformance is not par for the course for Treasury Wine shares this year.
Despite today's welcome boost, shares in the ASX 200 wine stock remain down 55.5% year to date.
Those losses will have only been modestly eased by the 40 cents per share in partly franked dividends Treasury Wine paid to eligible stockholders over the year. The ASX 200 stock trades on a trailing dividend yield of 7.9%.
So, after this horror year, is the company now a good buy for 2026?
Should you buy Treasury Wine shares today?
Bell Potter Securities' Christopher Watt recently ran his slide rule over the Aussie wine company (courtesy of The Bull).
"This global wine giant owns the premium Penfolds brand, among other labels," Watt said.
As for the big decline in Treasury Wine shares, he noted, "The share price recently plunged after TWE downgraded earnings."
Watt explained:
The company now expects earnings before interest and tax (EBIT) to range between $225 million and $235 million in the first half of fiscal year 2026. Prior EBIT consensus was $334 million.
Indeed, even at the higher end of its revised guidance, investors will have taken note that Treasury Wine's first-half earnings forecast is down a sharp 30%.
"We are currently experiencing category weakness in the US and China, two of our key growth markets, which will impact our business performance in the near-term," Treasury Wine CEO Sam Fischer said.
But Watt noted that management isn't sitting on its laurels.
He said:
The company is taking action to restore channel distribution and is actively reducing inventory levels across China and the United States. The shares have fallen from $7.88 on July 1 to trade at $4.80 on December 18.
Despite that steep sell-down, Watt isn't quite ready to pull the trigger yet, issuing a hold recommendation on Treasury Wine shares.
According to Watt:
TWE has a strategy, but a recovery will take time. At these price levels, patient investors can hold as the transition towards luxury wine remains a long-term positive. The stock carries calculated risk, so investors should continue to monitor news developments.
