It’s been a hard time out there for hard liquor. The Dow Jones Distillers & Vintners Index is down 10% YTD. On “Squawk on the Street,” CNBC's Mark Haines asked Brent Wilsey, president of Wilsey Asset Management why the winemakers and distilleries seem to be suffering from somewhat of a hangover.

“It’s a better time to be drinking the wine than buying the companies” right now, Wilsey said. He sees the main problem in the wine sector is inventory. Companies are seeing a glut of inventory and are looking to get rid of it – but to clear out inventory, one must lower prices, and that is why the sector isn’t performing.

Wilsey looked to two distillers in particular: Constellation Brands

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[STZ  Loading...      ()   ] and Brown Forman. His outlook on both is that they are too expensive and he urges investors to “be patient” with the stocks, as more downside is likely ahead.

Constellation Brands has seen a sales increase of 12% - yet its earnings last quarter only rose 1%. Why the disparity there? Wilsey says Constellation’s problem lies in their debt level – the company currently has about 130% debt-to-equity ratio and, Wilsey says, “that’s a little high for my comfort zone.”

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