Treasury Wine Estates (ASX:TWE) Crashes to Decade Low After A$687m US Writedown

Updated 1 December 2025 – informational only, not financial advice.

TWE share price: from market darling to deep drawdown

Treasury Wine Estates Limited (ASX:TWE), the owner of Penfolds, Wolf Blass and DAOU, has just added another nasty chapter to an already bruising year.

After warning it will book a non‑cash impairment of A$687.4 million on its US assets, wiping out all goodwill in its Americas division, TWE shares fell about 6–7% to roughly A$5.45, their lowest level since 2015. Year‑to‑date, the stock is now down around 50%, according to both Reuters and local market commentary. ^[1]

On Friday 28 November, before the latest shock, TWE had closed at A$5.82 on the ASX. ^[2] Over in the US, the OTC‑traded ADR (TSRYY) finished at US$3.87 on the same date, with a 52‑week range of US$3.62–7.94, implying investors have already more than halved the premium previously ascribed to the company. ^[3]

This sell‑off comes on top of an earlier collapse in October, when TWE withdrew its FY26 earnings guidance and paused a A$200m share buyback, sending the stock down 14% in a single session to A$5.99 – then a 10‑year low. ^[4]

What triggered today’s sell‑off? The A$687m US writedown

On 30 November 2025, TWE announced it expects to book a A$687.4 million impairment against its US business in FY26, effectively writing off all goodwill in the Americas division. ^[5]

Key points from the impairment announcement and early market reaction:

Full goodwill wipe in the Americas: The write‑down removes all goodwill assigned to the Americas segment, reflecting lower long‑term earnings expectations and more conservative growth forecasts for the US wine market. ^[6]
Structural US headwinds: TWE cited weaker growth and changing consumption patterns in the US – particularly at lower price points – as a key driver. The company has already been grappling with a “step‑down” in wine demand in the US, something several brokers have highlighted in recent months. ^[7]
Distribution mess in California: Earlier in the year TWE lost Republic National Distributing Company (RNDC) as its California distributor, with the transition to Breakthru Beverage Group expected to cost around A$50 million in sales and leaving about A$100 million of inventory in negotiation limbo. ^[8]
Premium brands still performing: Despite the impairment, premium US assets such as DAOU Vineyards and Frank Family Vineyards continue to grow, even as broader commercial and mid‑tier brands underperform. ^[9]

Australian broadcaster ABC summarised investor sentiment bluntly: TWE’s decision to write off the entire goodwill of its US business “hasn’t gone down well”, with the stock off around 50% year‑to‑date. RBC Capital Markets analyst Michael Toner called the move another negative signal, reinforcing the view that TWE overpaid for past US acquisitions. ^[10]

FNArena’s Monday report likewise notes that all A$687.4m of Americas goodwill is likely to be written off, underlining just how far the company is resetting the clock on its US strategy. ^[11]

October warning shot: guidance pulled, buyback paused

The impairment doesn’t come out of nowhere. On 13 October 2025, TWE delivered a major profit warning that shattered market confidence: ^[12]

The company withdrew its FY26 group earnings guidance and scrapped Penfolds targets for FY26 and FY27.
It paused the remaining A$170m of a A$200m on‑market share buyback launched in August (around A$30m had already been completed).
The stock fell 14% to A$5.99, its lowest price in more than a decade.

Management blamed two main issues:

China disappointment for Penfolds
- Demand for Penfolds in China has been weaker than expected, despite the removal of punitive tariffs in 2024.
- TWE cited changing drinking habits, fewer large banquets, and evolving consumption patterns – essentially, the Chinese premium wine party is not back to pre‑trade‑war levels. ^[13]
- Macquarie now assumes a 50% fall in Chinese Penfolds volumes in FY26, with stock likely to be re‑allocated to other markets at lower net sales revenue per case. ^[14]
US distribution disruption
- The exit of RNDC in California has created a meaningful hole in Treasury Americas revenue. TWE expects around A$50m in lost sales and is still negotiating over around A$100m of inventory. ^[15]

Following the update, FNArena reports that major brokers slashed earnings forecasts and targets:

Citi cut its target to A$5.50 and kept a Sell rating.
UBS downgraded from Buy to Neutral and chopped its target price by around 35%.
Morgans reduced its target from A$10.10 to A$6.35 and downgraded to Hold.
FNArena’s consensus target dropped about 25% to A$6.08 (from A$8.88), with five Hold‑equivalent ratings and one Sell. ^[16]

In other words: sentiment was already fragile. The US goodwill wipe just poured another bucket of cold water over the bull case.

A year of contrasts: strong FY25 numbers vs FY26 uncertainty

The sting in all of this is that FY25 actually looked very strong on paper.

For the year to 30 June 2025, TWE reported: ^[17]

Net sales revenue (NSR): A$2,938 million, up 7.2% year‑on‑year.
EBITS (Earnings Before Interest and Tax, pre‑SGARA): A$770.3 million, up 17%, with the EBITS margin expanding 2.2 percentage points to 26.2%.
Underlying NPAT: A$470.6m (excluding material items), with reported NPAT surging to A$436.9m due to the absence of prior‑year impairments. ^[18]

Underlying drivers:

Luxury and premium at the centre: Luxury and premium wines delivered around 55% of group NSR and 85% of EBITS, underlining how important brands like Penfolds and DAOU have become. ^[19]
Penfolds: Generated about A$1.07 billion in NSR with EBITS margins above 44%, helped by the reopening of the Chinese market and pricing power in global high‑end channels. ^[20]
Treasury Americas: NSR rose roughly 17% to A$1.17bn, with EBITS up 34%, boosted by DAOU and Frank Family Vineyards – the very business now facing a goodwill write‑down as growth expectations are reset. ^[21]

The company backed these results with:

A total FY25 dividend of A$0.40 per share (A$0.20 interim + A$0.20 final). ^[22]
A A$200m buyback launched in August 2025, now paused after A$30m was executed. ^[23]
A medium‑term ambition to grow EBITS around 15% per year to FY27, mainly by pushing deeper into luxury. ^[24]

So we have a classic clash: strong trailing numbers and brand economics versus rising doubt about the sustainability of those earnings in a structurally shifting wine market.

Balance sheet, cash flow and dividend yield

Despite the current storm, TWE’s balance sheet is not in obvious distress:

Net debt / EBITDAS: Around 1.9x, within the company’s target range. ^[25]
Cash conversion: FY25 cash conversion of roughly 87%, indicating solid translation of profit into cash. ^[26]

On valuation metrics:

Barchart data shows a trailing P/E of ~10.8x, forward P/E about 9.9x, price‑to‑sales ~1.6x, and price‑to‑book near 1.0x, based on late‑November prices. ^[27]
For FY25, the A$0.40 dividend represented a yield of about 6.7% at an A$5.97 share price quoted in late October; with the stock now around the mid‑A$5s or below, the trailing yield is higher still – assuming the payout is maintained. ^[28]

The big open question is whether the board keeps that dividend steady. Reuters notes that investors expect new CEO Sam Fischer to strike a cautious tone on capital returns – including the February dividend – at his investor update scheduled for mid‑December. ^[29]

Who owns TWE – and what are insiders doing?

Share registry and ownership data paint an interesting picture: ^[30]

Retail investors hold roughly 49% of the register,
Institutional investors about 47%,
Private companies around 3–4%.

Major shareholders include large global asset managers like State Street and BlackRock, and domestic institutional funds.

Director and executive dealings in 2025 have mostly been net buying:

Multiple non‑executive directors – including chair John Mullen and directors such as Toni Korsanos – have purchased shares on‑market over recent months.
New CEO Sam Fischer has received performance‑linked equity and also built a direct holding, aligning his incentives with shareholders. ^[31]

Insider buying is no guarantee of future returns, but in a year when the share price has been cut in half, it does signal management’s belief that the long‑term franchise is worth more than the current market price.

New CEO Sam Fischer inherits a tough brief

TWE’s board appointed Sam Fischer – formerly CEO of Lion and previously a senior Diageo executive – as CEO and Managing Director effective 27 October 2025, succeeding Tim Ford. ^[32]

Fischer brings about 30 years of global consumer and beverage experience, including deep exposure to Asian markets and premium alcohol brands. That’s directly relevant to TWE’s three biggest strategic headaches:

China: How to rebuild sustainable, non‑boom‑and‑bust demand for Penfolds in a market where tariffs are gone but banquet culture and government attitudes to conspicuous corporate drinking have changed. ^[33]
US: What to do with a capital‑intensive US footprint where category growth is slowing, promotional intensity is rising, and distribution relationships have become fragile – as seen with the RNDC exit. ^[34]
Portfolio mix: How far and fast to tilt further into luxury (Penfolds, DAOU, Stags’ Leap, etc.) versus more volatile premium and commercial tiers.

Investors will get the first real glimpse of Fischer’s roadmap at the mid‑December investor and analyst call, where he is expected to address the writedown, growth strategy and capital allocation priorities in more detail. ^[35]

What do analysts and models say about TWE stock now?

Sell‑side broker consensus

Different data providers paint slightly different pictures, but the broad message is:

MarketScreener: Mean consensus rating “Outperform” from 15 analysts, with an average 12‑month target of A$7.86, implying upside of roughly 35% from a recent A$5.82 close. High target A$11.50, low A$5.26. ^[36]
Simply Wall St: Very similar numbers – about A$7.86 average target, high A$11.50, low A$5.26 – implying upside near 35% from around A$5.82. ^[37]
ValueInvesting.io: Average target A$7.74, range A$5.31–10.40, with a consensus recommendation labelled Hold based on 19 analyst ratings. ^[38]
TipRanks (ASX:TWE): Describes the stock as a “Moderate Buy” based on 10 analyst ratings. ^[39]

In other words, the typical broker still thinks the shares are undervalued by roughly one‑third, but has also cut targets and toned down enthusiasm after the October guidance withdrawal and the latest writedown.

There is, however, wide dispersion behind that average:

RBC Capital Markets has kept an Outperform rating with a double‑digit target (A$11.00 earlier in 2025) and continues to emphasise the quality of the luxury portfolio. ^[40]
Jefferies cut its target to A$8.50 in October, explicitly flagging the combination of depressed valuation and a new CEO as potential catalysts – but also noting that an exit or restructuring of the US business may be required to unlock value. ^[41]
Citi sits at the cautious end with a Sell and A$5.50 target, worrying that structural shifts in alcohol consumption in both China and the US may keep earnings under pressure for longer than bulls expect. ^[42]

Technical and algorithmic views

Quant and technical‑analysis platforms are, unsurprisingly, more downbeat:

StockInvest (ASX:TWE) currently classifies the stock as a “Sell candidate” despite a recent bounce, forecasting that the price could fall around 30% over the next three months with a 90% probability range between A$3.68 and A$4.05. ^[43]
For the US ADR TSRYY, StockInvest likewise carries a negative view and notes a 52‑week range of US$3.62–7.94 with the price at US$3.87 as of 28 November. ^[44]
WalletInvestor, an algorithm‑based forecasting service, projects TWE will trade roughly in the mid‑A$5 range in early 2026, with January 2026 daily “average” forecasts around A$5.3. ^[45]

Algorithmic forecasts should always be treated carefully – they typically extrapolate recent trends rather than perform deep fundamental analysis – but they do highlight that momentum and sentiment are still negative despite apparent fundamental value.

Key risks to the TWE investment case

For investors weighing up Treasury Wine Estates after this reset, the main risks now look something like this:

China may never fully go “back to normal”
The reopening after tariffs has not produced the explosive, easy growth many hoped for. Government crackdowns on lavish corporate entertainment, softer restaurant sales in major cities, and shifting preferences among younger drinkers all raise the possibility that Penfolds volumes in China settle at a permanently lower plateau than pre‑trade‑war levels. ^[46]
US demand may be structurally weaker
Analysts at UBS and others describe the US alcohol market as experiencing a “step‑change down”, with wine losing share to spirits, RTDs and non‑alcoholic options. ^[47] If the US wine category is structurally less profitable, TWE’s large investment in DAOU, Frank Family and other brands may deliver lower returns than originally modeled – even after goodwill is written off.
Distribution and channel risk
The RNDC exit showed how exposed TWE can be to big distribution partners. The transition to Breakthru in California is still being bedded down, and the eventual resolution of A$100m‑plus in stranded inventory could have further financial implications. ^[48]
More downgrades if macro weakens
Brokers like Morgan Stanley and Morgans are explicit that it is hard to distinguish cyclical inventory issues from structural demand change at this point. That ambiguity leaves the door open to further earnings downgrades if Chinese or US demand disappoints again in FY26. ^[49]
Execution risk for the new CEO
Sam Fischer has the right CV for the job, but turning around a global portfolio in the face of category headwinds is non‑trivial. Strategic choices – whether to double down on luxury, exit parts of the US, or re‑shape the commercial portfolio – will likely determine whether TWE is a value opportunity or a value trap five years from now. ^[50]

The bottom line: value or value trap?

By traditional valuation metrics, Treasury Wine Estates now looks cheap:

A profitable, cash‑generative company with leading global wine brands, trading at about 10–11x trailing earnings and close to book value, with a high‑single‑digit trailing dividend yield if the FY25 payout were maintained. ^[51]
Sell‑side analysts, on average, still see 30–35% upside from current levels over 12 months, even after cutting their target prices. ^[52]

But the market is clearly telling a different story: structural uncertainty in China and the US, plus the latest A$687m writedown, has shattered investor confidence. Quant and technical models are still flashing “sell”, and at least one major broker sits on an outright Sell rating. ^[53]

For now, TWE sits at a crossroads:

If Sam Fischer can stabilise China, clean up the US distribution mess, and prove that the luxury portfolio can keep compounding earnings even in a slower‑growth world, today’s prices may later be remembered as an opportunity.
If not, the current low multiple could be a value trap that merely reflects a structurally diminished earnings base in a shrinking category.

Either way, the next few months – particularly the mid‑December investor update and FY26 interim results in February – will be critical checkpoints for anyone following Treasury Wine Estates (ASX:TWE).