Shares of Constellation Brands (STZ) are sliding after Bank of America Merrill Lynch analyst Bryan Spillane downgraded the stock to Underperform, a sell-equivalent rating, saying a Trump victory brings uncertainty given his stance on trade and immigration.

FUTURE GROWTH UNCERTAINTY: In a research note this morning, Bank of America Merrill Lynch's Spillane downgraded Constellation Brands to Underperform from Buy given President-elect Donald Trump's stance on trade and immigration, namely his plans to build a physical wall on the southern border with Mexico, renegotiate trade agreements, and add tariffs/taxes, among others. The analyst noted that Constellation Brands' Mexican beer business represented 52.6% of net sales and 63.5% of profits in 2016. Further, all of the company's imported beers are made in Mexico and imported into the U.S., Spillane pointed out. The analyst told investors that a Trump victory creates uncertainty for Constellation's future growth, especially given his pledge to impose 35% tariffs on Mexican goods.

WHAT'S NOTABLE: On October 31, Constellation Brands announced that it will submit to the U.S. Department of Justice a proposal to acquire a brewery operation from Grupo Modelo, a subsidiary of Anheuser-Busch InBev (BUD), for $600M. The brewery, located in Obregon, Mexico, is expected to have four million hectoliters of production capacity with minimal investment and optimization by Constellation after closing, the company noted.

PRICE ACTION: In late morning trading, shares of Constellation Brands have dropped about 8.5% to $152.48.