The Coca-Cola Company (KO), headquartered in Atlanta, Georgia, is a beverage company that manufactures, markets, and sells various nonalcoholic beverages worldwide. With a market cap of $275.4 billion, the company also distributes and markets juice and juice-drink products to retailers and wholesalers worldwide.
Shares of this beverage giant have underperformed the broader market over the past year. KO has gained 12% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 36.8%. In 2024, KO stock is up 8.5%, compared to the SPX’s 25.7% rise on a YTD basis.
Narrowing the focus, KO’s outperformance is apparent compared to the First Trust Nasdaq Food & Beverage ETF (FTXG). The exchange-traded fund has gained about 4.6% over the past year. Moreover, KO’s returns on a YTD basis outshine the ETF’s marginal losses over the same time frame.
Coca-Cola’s European market faces challenges with weak consumer demand impacting bottling operations and due to that its Euro-pacific partners lowered its sales forecast. Additionally, economic pressures and decreased convenience store traffic have led to lower demand. The company is also facing a lawsuit in Los Angeles County for contributing to plastic pollution and alleged deceptive business practices.
On Oct. 30, KO shares closed up marginally after reporting its Q3 results. Its adjusted EPS grew 4.1% year over year to $0.77. The company’s adjusted revenue stood at $11.9 billion, up marginally year over year.
For the current fiscal year, ending in December, analysts expect KO’s EPS to grow 6% to $2.85 on a diluted basis. The company’s earnings surprise history is impressive. It beat the consensus estimate in each of the last four quarters.
Among the 21 analysts covering KO stock, the consensus is a “Strong Buy.” That’s based on 15 “Strong Buy” ratings, one “Moderate Buy,” and five “Holds.”
The configuration has been consistent over the past three months.
On Oct. 25, Barclays PLC (BCS) kept an “Overweight” rating and lowered the price target to $73, implying a potential upside of 14.2% from current levels.
The mean price target of $74.52 represents a 16.6% premium to KO’s current price levels. The Street-high price target of $85 suggests an upside potential of 33%.
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
