It might be time for investors to start getting excited about the alcoholic beverage space again. Constellation Brands (STZ 0.78%), which enjoyed strong growth in its core beer business last year, is set to announce quarterly results in a few days that will set the tone for its wider fiscal 2022 year. That report could show market share momentum against rivals like Boston Beer even as Constellation spends heavily on its long-term growth initiatives.

Let's take a closer look at Wednesday's upcoming report.

Two people hold pints of beer.

Image source: Getty Images.

Growth and market share

Constellation Brands' pandemic year was packed with good news for shareholders. Its portfolio of premium imported beers (like Corona and Modelo) remained popular with consumers who shifted their drinking habits away from restaurants and bars. The company's double-digit sales boost kept it above beer giants like Anheuser Busch InBev, but behind the industry leader, Boston Beer.

Investors are hoping Constellation can continue winning share in the beer business by focusing on the high-end import category. We'll also get a key update on the health of its hard seltzer brand, which recently launched new flavors in a bid to push market share above the current 6% rate.

Turning the wine business around

Investors have been waiting for several quarters for firm data showing that Constellation's wine business is on the mend, and this week might finally bring that good news. Excluding its recently divested brands, that part of the portfolio grew 5% last quarter. CEO Bill Newlands and his team are aiming for faster gains now that they've removed underperforming products.

STZ Operating Margin (TTM) Chart

STZ Operating Margin (TTM) data by YCharts

Meanwhile, they're targeting profit margins higher than 30% of sales in the niche, compared to the blazing 41% rate the company enjoys in its beer segment. Shareholders should see encouraging progress on that score in 2022 after the wine segment dragged overall margins lower last year.

Updating the outlook

Constellation today is pouring resources into its Mexican brewery network, and those investments are highly likely to generate impressive returns over time. Capital is also flowing into the Canopy Growth business as the company lays the groundwork for its cannabis drink portfolio. We'll hear general comments about each of these long-term projects on Wednesday.

The more concrete outlook metric is organic sales. Executives said in April that they're expecting between 2% and 4% growth in fiscal 2022 on top of last year's strong result. Management believes it can hit this aggressive target thanks to market share growth and a steady stream of new product introductions and more convenient packaging for brands like Modelo. The bullish thesis for the stock also relies on Constellation boosting its prices at a faster rate than inflation, which should be easy in this selling environment given its focus on premium drinks.

The company might stay conservative in its outlook update on Wednesday since so much of the fiscal year is ahead and there will likely be some big shifts in consumer spending habits in the immediate wake of the pandemic. But Constellation Brands can still reasonably target a 12th consecutive year of growth for its beer business and improving margins overall in fiscal 2022.