Constellation Brands Inc.’s STZ shares rose 4.1% in pre-market trading hours after it reported stellar fourth-quarter fiscal 2016 results. The top and bottom lines exceeded expectations and improved year over year which encouraged management to issue a heartening guidance for fiscal 2017.Results were mainly backed by continued strength in the company’s beer business, improving trends at its wine and spirits business and solid overall depletion trends.Q4 HighlightsThe company’s adjusted earnings for the fourth quarter of fiscal 2016 jumped 15.5% year over year to $1.19 per share, which also fared better than the Zacks Consensus Estimate of $1.14. This marked the company’s sixth straight quarter of positive earnings surprise.Constellation Brands Inc. (STZ) Street Actual & Estimate EPS - Last 5 Quarters | FindTheCompany Net sales increased 14% to $1,543.2 million, driven by strong organic sales growth and gains from the Meiomi and Ballast Point acquisitions, partly offset by currency headwinds. On a currency adjusted basis, consolidated organic sales grew 10%. Moreover, the company’s top line exceeded the Zacks Consensus Estimate of $1,526 million.Sales also benefited from strong volumes and favorable pricing at the beer business, which drove an 18% sales growth in that segment. Also, the segment witnessed a 13.2% rise in depletions, backed by solid demand. Wine and spirits’ sales improved 4% year over year, on a constant currency basis, mainly driven by increased volumes.Cost and Margin PerformanceAdjusted gross profit for the fiscal fourth quarter rose 21% year over year to $715.6 million, while adjusted gross profit margin expanded 260 basis points (bps) to 46.4%.Constellation Brands' comparable operating income escalated nearly 24% to $432.8 million, with the comparable operating margin expanding 240 bps to 28.2%. This was backed by solid operating income growth at both the beer (29%), and wine and spirits (14%) businesses. The beer segment gained from higher organic volume, effective pricing and a lower cost of products sold, while growth at the wine and spirits segment was attributed to the Meiomi acquisition, increased organic volumes and lower cost of sales. However, results at both segments were partly dampened by higher marketing expenses. Financial PositionConstellation Brands ended fiscal 2016 with cash and cash equivalents of $83.1 million. As of Feb 29, 2016, the company had $6,816 million in long-term debt (excluding current maturities) and its total shareholders’ equity was $6,691.8 million.In fiscal 2016, Constellation Brands generated $1,413.7 million in cash from operations and free cash flow of $522 million. During the fiscal fourth quarter, the company bought back nearly 246,000 shares for about $34 million.On Apr 5, 2016, the company raised its quarterly dividend by 29% for both Class A and Class B shares. The company will now pay a quarterly cash dividend of 40 cents per share on Class A shares and 36 cents per share on Class B shares. The revised dividend rate is payable on May 24, to shareholders on record as of May 10.Other DevelopmentsWith a view to support the future growth of its Mexican beer business, which is currently outperforming the U.S. beer business, the company recently acquired the Ballast Point craft beer, completed a 5 million hectoliter capacity expansion at its Nava brewery and started investing in a new brewery at Mexicali in Mexico.Further, to strengthen its position in the wine and spirits business, the company agreed to acquire The Prisoner Wine Company brands portfolio from Huneeus Vintners for about $285 million. The portfolio of brands includes five highly rated wine brands, namely The Prisoner, Saldo, Cuttings, Blindfold and Thorn. These wine brands have to their credit a strong annual volumes growth rate of 30% over the last three years, reaching 175,000 cases in 2015. The company expects the deal to close by the end of Apr 2016 and be accretive by 3–5 cents to fiscal 2017 earnings per share.Also, in an attempt to create value for its shareholders and strengthen the financial position of its Wine and Spirits business, the company is assessing the advantages of executing an initial public offer (IPO) for a certain portion of its Canadian wine business.Fiscal 2017 OutlookAfter closing fiscal 2016 on a strong note, Constellation Brands provided an encouraging outlook for fiscal 2017. Management envisions adjusted earnings in the range of $6.05–$6.35 per share, compared with $5.43 recorded for fiscal 2016.On a reported basis, earnings per share for fiscal 2017 are anticipated at $6.00–$6.30 against $5.18 reported for fiscal 2016. Further, the company expects both net sales and operating income for the beer segment to grow in the 14–17% range, accounting for the gains coming from the recent Ballast Point acquisition. Further, the company’s wine and spirits’ sales growth is projected in the mid-single digit range, while operating income is expected to grow in the mid-to-high single-digit range, including gains from the Meiomi and Prisoner acquisitions.Certain factors were taken into consideration before providing the earnings guidance. These include an interest expense expectation of $325–$335 million, an approximate tax rate of 29% and weighted average diluted shares outstanding of approximately 206 million.Further, the company anticipates capital expenditure in the range of $1.25–$1.35 billion for fiscal 2017, as it continues to progress with the expansion of its Mexican beer business.The company’s free cash flow expectation ranges between $250 million and $350 million for fiscal 2017, while operating cash flow is projected in the range of $1.5–$1.7 billion.Zacks RankConstellation Brands currently carries a Zacks Rank #2 (Buy). Another equally-ranked stock in the same industry is Castle Brands Inc. ROX. Some stocks in the related beverage-soft drinks space worth considering include Cott Corporation COT and REEDS Inc. REED, each again with a Zacks Rank #2.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report CASTLE BRANDS (ROX): Free Stock Analysis Report COTT CORP QUE (COT): Free Stock Analysis Report CONSTELLATN BRD (STZ): Free Stock Analysis Report REEDS INC (REED): Free Stock Analysis Report To read this article on Zacks.com click here.