Most stocks suffered last year. The S&P 500 was down for the first time since the 2008 recovery. But Constellation Brands (NYSE:STZ) stock did much worse. The stock is down over 30% in the past 12 months, outstripping many others in the sector.

A lot of it came yesterday when management delivered a mediocre earnings report. Profits fell and they lowered forward guidance expectations. The stock plunged 12% on the headline.

STZ stock is now lagging far behind competitors like Molson Coors (NYSE:TAP) and Diageo (NYSE:DEO). But there is hope from several angles.

So today’s trade is to go long the stock for the mid-term. This is a fundamental decision since it is now trading at 10 trailing price-to-earnings ratio. Owning it here is not likely to be a colossal financial mistake. There is much more upside potential than downside risk.

Now the Good News for STZ Stock…

Constellation management is proven and they are not afraid to make bold moves. This is evident from their $4 billion investment in Canopy Growth (NYSE:CGC) a budding company (no pun intended) that competes in the cannabis sector. Clearly they are looking far out into the future. To that point, other experts agree as Goldman Sachs and Guggenheim upgraded the stock overnight.

In addition, a more encouraging tidbit of information came to light last night on CNBC. Rob Sands, who is the departing Constellation CEO, announced that he and his brother bought 1.1 million shares. So this is a huge bullish statement that the company is well on track. Else why risk $150 million?

Moreover, there is also technical hope. STZ stock has fallen into an abyss but this is also a potential area of support. Almost two years ago it broke out from these levels to start a 44% rally. It is now far below those highs but therein lies the opportunity.

These pivot zones usually create congestion because both bulls and bears will want to fight over them thereby creating the support. This combined with the facts that broke out yesterday from the departing CEO create the potential of a bottom.

The experts on Wall Street agree. Most analysts have at least a “buy” rating on it even though it is trading much lower than their lowest of price targets. Overnight we’ve seen two already defend the stock so there is clear value. I expect this to continue.

There are reasons to worry. First we still have macroeconomic headline risk from the tariff wars between the U.S. and China. Second, STZ has a small chance of catching a surprise downgrade. The longer the price is this far below target the higher the odds of analysts capitulating.

So I don’t want to take any full-size position at this level so I will break the trade into two parts. First I buy the shares outright. Then to average down in a sense I will use options.

I sell the STZ Jul $115 put and collect $1.50 per contract. This is also a bullish trade which has a 90% theoretical chance of winning. If the price falls below $115 I have to own the shares and accrue losses below $113.50 per share. Long term, I am confident that I can make this position yield profit.

Click here and enjoy a free video and more of my market thesis and get an ongoing free copy of my weekly newsletters. Nicolas Chahine is the managing director of SellSpreads.com. As of this writing, he did not hold a position in any of the aforementioned securities. You can follow him as @racernic on Twitter and Stocktwits.