Below are key drivers of the Coca-Cola Company that present opportunities for upside or downside to the current Trefis price estimate:
The Coca-Cola Company is the world’s world's largest beverage company, with more than 500 nonalcoholic beverage brands in the sparkling soft drinks; water, enhanced water and sports drinks; juice, dairy and plant-based beverages; tea and coffee; and energy drinks categories. The company owns and markets four of the world's top five nonalcoholic sparkling soft drink brands: Coca-Cola, Diet Coke, Fanta, and Sprite. Sparkling soft drinks represented 69 percent, 69 percent and 70 percent of the company's worldwide unit case volume for 2017, 2016 and 2015, respectively.
Soft drink consumption is on a decline in developed countries as consumers switch to healthier alternatives such as juices, Ready-to-Drink (RTD) teas, RTD coffee, water mixers, etc. Moreover, soft drinks are prone to higher taxation due to their unhealthy nature. Hence, volume consumption is on a decline in the U.S. and Europe. Developing nations, on the other hand, offer tremendous potential in terms of volume growth. Soft drink consumption (per capita) in countries like China, India, and Brazil is still only a fraction of what it is in the developed world.
Consumers have been shifting to natural and healthier beverages with less sugar and calorie content due to the health risks associated with sugary drinks. The diet counterparts have fared even worse, with the artificial sweetener aspartame being criticized for causing sugar cravings, dehydration, weight gain, and even heart diseases. Consumers have also reported bitter aftertastes of diet drinks which use the natural sweetener stevia, initially considered a bankable solution.
The Coca-Cola Company North America announced the acquisition of premium sparkling mineral water brand Topo Chico in the beginning of October 2017. Topo Chico will continue to be imported from Cerro del Topo Chico in northern Mexico, where it has been bottled exclusively since 1895. The company has a long history with this brand as the first Coca-Cola bottle in Mexico was manufactured at this facility. This deal has been made as a part of the company's Venturing & Emerging Brands (VEB), a business unit whose aim is to identify and nurture brands that have a billion-dollar potential. It functions like a venture capital arm of Coca-Cola that meets with brands that are mostly in the start-up phase, and which are poised for market disruption. Given that nationally, more than $2.3 billion worth of bottled sparkling water is sold every year, according to consumer market researcher Information Resources Inc., it is definitely a significant market for Coca-Cola to ply its trade.
According to the Canadean, consumption of packaged water overtook the intake of carbonated soft drinks (CSDs) in 2015.
While growth in the bottled water category is expected to continue outpacing growth in the CSD category in the next few years, most of this growth will come from emerging markets such as China, Mexico, and India--where clean tap water is not as easily available.
Growing health concerns have prompted customers to reduce their consumption of calorie-filled beverages such as CSDs and juices. This has benefited the bottled water category, as some customers have switched to consuming bottled water instead of other sugary beverages. The U.S. is the fastest growing bottled water market outside of Asia. This trend is expected to continue and, thus, boost the U.S. bottled water market size. Bottled water overtook CSDs as America’s largest beverage category in volume in 2016.
Coca-Cola (NYSE: KO) is slated to release its Q4 and full-year 2019 results on January 30, 2020. Trefis details expectations from the company in an interactive dashboard, parts of which are highlighted below. ...More
PepsiCo (NASDAQ: PEP) and Coca-Cola (NYSE: KO) are the two largest non-alcoholic beverage manufacturers in the world with a range of sparkling soft drinks, juices, energy drinks, etc. ...More
Based on its current market price and future growth prospects, Coca-Cola (NYSE: KO) looks undervalued at present. Trefis has a price estimate of $57 per share for Coca-Cola’s stock, higher than its current market price of $53 (as on November 19, 2019), which reflects an upside of 7.5%. ...More
Coca-Cola (NYSE: KO) has its expenses largely clubbed under its cost of goods sold and SG&A expenses, which together accounted for about 87% of the company’s total expenses in 2018. However, this is a reduction from 92% of total expenses that these two cost heads accounted for in 2015. ...More
Coca-Cola (NYSE: KO) is one of the largest beverage companies with a diversified geographic presence. A] Business Model 1) What Does It Offer? Coca-Cola Revenues (How Does Coca-Cola Make Money) are generated by the sale of a variety of beverages such as sparkling soft drinks... ...More
Coca-Cola Company (NYSE: KO) is set to announce its Q2 2019 financial results on July 23, 2019, followed by a conference call with analysts. The company started the year 2019 on a positive note with a y-o-y revenue growth of 5.2% in Q1 2019 and Trefis expects this trend to continue through the year. ...More
Coca-Cola Company (NYSE: KO) released its Q1 2019 financial results on April 23, 2019, followed by a conference call with analysts. KO beat market expectations for revenue as well as earnings. The company reported revenue of $8.02 billion in Q1 2019, marking a growth of 5.2% over Q1 2018. ...More
Coca-Cola Company (NYSE: KO) is set to announce its financial results for Q1 2019 on April 23, 2019, followed by a conference call with analysts. Total revenues for Coca-Cola have largely trended lower over recent quarters, falling from $8.9 billion in Q2 2018 to $7.1 billion in Q4 2018. ...More
It has been a long time since both, Coca-Cola (NYSE:KO) and PepsiCo (NASDAQ:PEP), diversified into segments other than carbonated soft drinks (CSD) by selling juices, water, sports drinks, iced coffee, snacks, and other beverages. ...More
The Coca-Cola Company (NYSE: KO) released its Q4 2018 results on February 14, 2019, followed by a conference call with analysts. The company fell short of analysts’ expectations for revenue, primarily due to loss of revenue from the refranchising of company-owned bottling operations and the impact of currency. The company reported net revenue of $7. ...More
The Coca-Cola Company (NYSE: KO) is set to announce its fourth quarter results on February 14, 2019, followed by a conference call with analysts. The market expects the company to report net revenue of $7.03 billion in Q4 2018, 6.4% lower than in Q4 2017. Adjusted earnings for the quarter are expected to be $0.43 per share compared to $0. ...More
The Coca-Cola Company (NYSE:KO) announced its third quarter results on October 30, with its revenue of $8.25 billion and EPS of $0.58 exceeding consensus expectation. Even though the core performance of the company remained solid in the quarter, the top line took a hit due to the refranchising of bottling operations across geographies. ...More
The Coca-Cola Company (NYSE:KO) is scheduled to announce its third quarter results on October 30, and even though the core performance might remain solid, the top line is expected to take a hit due to the refranchising of bottling operations across geographies. This trend has continued for the past several quarters, with a 15% headwind to the revenues reported in the second quarter. ...More
The Coca-Cola Company (NYSE:KO) is the latest beverage giant mulling an entry into the marijuana space. According to a report in BNN Bloomberg, the company is in "serious talks" with Aurora Cannabis (TSE: ACB) to develop cannabis-infused beverages. ...More
The Coca-Cola Company (NYSE:KO) announced its intention of acquiring Costa Limited from parent company Whitbread PLC for $5.1 billion. This deal, expected to close in the first half of FY 2019, would give the cola giant a strong coffee platform across parts of Europe, Asia Pacific, the Middle East, and Africa. ...More
The Coca-Cola Company (NYSE:KO) reported strong second quarter results, driven by an impressive price/mix, as well as volume growth. These factors helped the company beat consensus expectations on both revenue and earnings. ...More
The Coca-Cola Company (NYSE:KO) is scheduled to announce its second quarter results on July 25, and even though the core performance might remain solid, the top line is expected to take a hit due to the refranchising of bottling operations across geographies. This trend has continued for the past several quarters, with a 26% headwind to the revenues reported in the first quarter. ...More
For the first time in its history, The Coca-Cola Company (NYSE:KO) launched a lemon-flavored alcoholic drink in the southwestern island of Kyushu in Japan. ...More
The Coca-Cola Company (NYSE:KO) had a solid start to 2018, posting results that beat consensus estimates on both revenues and earnings. As has been the case in recent quarters, the refranchising efforts were a 26% headwind to the revenues, which declined by 16%. ...More
The Coca-Cola Company (NYSE:KO) is scheduled to announce its first quarter results on April 24, and even though the core performance might remain solid, the top line is expected to take a hit due to the refranchising of bottling operations across geographies. ...More