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Constellation Brands (STZ) Up on Q4 Earnings & Sales Beat

Constellation Brands Inc. STZ, a leading international producer and marketer of beverage alcohol brands, released fourth-quarter fiscal 2016 results, wherein adjusted earnings of $1.19 a share surpassed the Zacks Consensus Estimate of 1.14. Moreover, the bottom line rose 15.5% from $1.03 a share earned in the year-ago quarter.

Based on the sustained strength of its beer business, Constellation Brands expects adjusted earnings per share for fiscal 2017 in a band of $6.05–$6.35 and GAAP earnings of $6.00–6.30.

Earnings Estimate Revision: The Zacks Consensus Estimate portrays an upside in the last 7 days. Constellation Brands’ performance in the trailing four quarters (including the quarter under review) gives a positive picture. The company outperformed the Zacks Consensus Estimate by an average of nearly 9.2% in the trailing four quarters.

Revenues: Constellation Brands generated net sales of $1543.2 million that increased 14% year over year and outdid the Zacks Consensus Estimate of $1,526 million, mainly driven by solid organic sales growth coupled with contributions from Meiomi and Ballast Point acquisitions.

Key Events: Constellation Brands announced plans to buy The Prisoner Wine Company`s portfolio of brands from Huneeus Vintners. The deal, which is anticipated to close by the end of April, includes five fine wine brands namely Prisoner, Saldo, Cuttings, Blindfold and Thorn.

Also, the company is on track to assess plans to implement an Initial Public Offering (‘’IPO’’) for a part of its Canadian wine operations. However, any final decision related to this announcement is anticipated to be made in the end of the current calendar year.

Constellation Brands also hiked its quarterly cash dividend by 29% to 40 cents per share and 36 cents a share on Class A and Class B Common Stock, respectively. This is payable on May 24, 2016 to stockholders of record as on May 10. During the fourth quarter, the company bought back nearly 246,000 shares for $34 million.

Zacks Rank: Currently, Constellation Brands carries a Zacks Rank #2 (Buy) which is subject to change following the earnings announcement.

Stock Movement: Constellation Brands’ shares jumped about 2.1% during pre-market trading hours following the stellar fourth-quarter results.

Check back later for our full write up on Constellation Brands’ earnings report!

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CONSTELLATN BRD (STZ): Free Stock Analysis Report
 
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