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Highlights

  • Jefferies retains “Buy” rating on TWE with a 47.42% upside to a price target of AUD 12.00
  • FY25 EBIT guidance lowered to ~AUD 770 million from ~AUD 780 million
  • U.S. distribution shake-up and soft demand prompt cautious investor sentiment

Despite recent earnings downgrades and disruption in its U.S. distribution network, Jefferies has reaffirmed its “Buy” rating on Australia’s top winemaker, Treasury Wine Estates (ASX:TWE). The broker has set a price target of AUD 12.00, implying a 47.42% premium to current levels.

Guidance Revised

TWE announced it now expects FY25 earnings before interest and taxes (EBIT) to come in at approximately AUD 770 million, slightly down from earlier guidance of ~AUD 780 million. The revision stems from softer-than-expected premium wine shipments in the U.S., particularly in the sub-USAUD 15 segment, due to ongoing economic uncertainty and weakened consumer demand.

Distributor Exit Adds Pressure, But Not a Dealbreaker

The company also confirmed that its U.S. distributor, Republic National Distributing Company (RNDC), will exit operations in California on 2 September. This is notable as RNDC California accounted for 25% of Treasury Americas’ net sales revenue and 10% of group revenue in the first half. TWE, however, assured that this change is not expected to affect its FY results significantly.

Strategic Shareholder Activity

In a related development, JPMorgan Chase & Co. has become a substantial shareholder, holding 5.19% voting power in Treasury Wine Estates as of 30 May 2025.