Stock of the Day

May 24, 2022

Coca-Cola (KO)

$71.37
+$1.33 (+1.9%)
Market Cap: $307.36B

About Coca-Cola

The Coca-Cola Company, a beverage company, manufactures, markets, and sells various nonalcoholic beverages worldwide. The company provides sparkling soft drinks, sparkling flavors; water, sports, coffee, and tea; juice, value-added dairy, and plant-based beverages; and other beverages. It also offers beverage concentrates and syrups, as well as fountain syrups to fountain retailers, such as restaurants and convenience stores. The company sells its products under the Coca-Cola, Diet Coke/Coca-Cola Light, Coca-Cola Zero Sugar, caffeine free Diet Coke, Cherry Coke, Fanta Orange, Fanta Zero Orange, Fanta Zero Sugar, Fanta Apple, Sprite, Sprite Zero Sugar, Simply Orange, Simply Apple, Simply Grapefruit, Fresca, Schweppes, Thums Up, Aquarius, Ayataka, BODYARMOR, Ciel, Costa, Dasani, dogadan, FUZE TEA, Georgia, glacéau smartwater, glacéau vitaminwater, Gold Peak, Ice Dew, I LOHAS, Powerade, Topo Chico, AdeS, Del Valle, fairlife, innocent, Minute Maid, and Minute Maid Pulpy brands. It operates through a network of independent bottling partners, distributors, wholesalers, and retailers, as well as through bottling and distribution operators. The company was founded in 1886 and is headquartered in Atlanta, Georgia.

Coca-Cola Bull Case

Here are some ways that investors could benefit from investing in Coke:

  • Coke recently reported earnings per share (EPS) of $0.55, surpassing the consensus estimate of $0.51, indicating strong financial performance and effective cost management.
  • The company has a robust net margin of 22.45%, which reflects its ability to convert revenue into profit efficiently, making it an attractive investment for those seeking profitability.
  • With a current stock price around $63.02, which is below its 52-week high of $73.53, there may be potential for price appreciation as the market recognizes its value.
  • Analysts have a consensus rating of "Moderate Buy" for Coke, with a price target averaging $73.82, suggesting that there is room for growth in the stock price based on analyst expectations.
  • Coke has a strong return on equity of 44.01%, indicating effective management and a high level of profitability relative to shareholder equity, which can attract long-term investors.

Coca-Cola Bear Case

Investors should be bearish about investing in Coke for these reasons:

  • Despite recent upgrades from various analysts, some firms have lowered their price targets, indicating potential volatility and uncertainty in the stock's future performance.
  • The stock's fifty-day moving average of $63.02 is below its two-hundred day moving average of $66.36, which may suggest a bearish trend and could indicate a lack of momentum in the stock price.
  • With a fifty-two week low of $57.93, there is a risk that the stock could decline further if market conditions worsen or if the company fails to meet future earnings expectations.
  • In a competitive beverage market, Coke faces challenges from health-conscious consumers shifting away from sugary drinks, which could impact future sales and profitability.
  • While the company has a strong net margin, any significant increase in costs or changes in consumer preferences could adversely affect its profitability and stock performance.

MarketBeat: Week in Review 4/25 – 4/29

Written By Chris Markoch on 4/29/2022

It’s been another wild week on Wall Street. Positive earnings reports from Microsoft, Meta Platforms, and Apple are not enough to offset the expectation of rising interest rates and continued inflation. Institutional investors continue to reprice stocks with the expectation of two 50 basis point increases by June. And, the personal consumption expenditure (PCE) price index did nothing to help. The top line 5.2% number was in line with expectations. However, investors don’t have to drill too deep to see that employment prices, as well as volatile food and energy prices, are still running hot. Next week will bring another full slate of earnings reports. And the MarketBeat team will be on top of the key market movers so your portfolio can profit.

Articles by Sean Sechler                                                                                                                                                                

At any time, but particularly in times of market volatility, investors should look for resilient stocks. These stocks don’t always go higher (no stock does), but they do have the benefit of delivering consistently positive performance in any economy. That’s what makes these stocks an ideal choice for retirement accounts. This week, Sean Sechler highlighted three resilient stocks that investors can consider adding to their watch list. As Sechler reminds investors, these stocks may be excellent buy-the-dip candidates.

Articles by Jea Yu

Jea Yu is looking at two tech stocks that are falling for different reasons. Xerox Holdings (NYSE:XRX) is moving lower after it posted disappointing earnings that surprised analysts. In the case of Cisco Systems (NASDAQ:CSCO) the stock is moving lower even though it beat on the top and bottom lines when it reported earnings in February. If these stocks are on your watch list, be sure to read Yu’s perspective on why, and when, you should consider entering a position. Yu was also looking at the disappointing earnings delivered by Charles Schwab (NYSE:SCHW). However, Yu points out that the brokerage is still seeing strong organic growth that should be accretive to the stock particularly with higher interest rates on the horizon.

Articles by Thomas Hughes

All good things come to an end. Which is the cautionary note that Thomas Hughes sounds for Tractor Supply Company (NASDAQ:TSCO). It’s not that the company is performing poorly, its growth is just slowing. However, as Hughes points out the situation may be transitory which may make TSCO stock a buy later this year. One stock that is exceeding expectations is Whirlpool (NYSE:WHR). The company continues to protect its margins and its dividend which is making it a solid value stock. Hughes was also commenting on the price action for Coca-Cola (NYSE:KO) stock. The company’s stock surged after strong earnings. However, upon hitting an all-time high, the profit takers have weighed in which could affect the short-term outlook for KO stock.

Articles by Sam Quirke

Sam Quirke was boldly looking at the tech sector and the takeaway is that investors who are ignoring Microsoft (NASDAQ:MSFT) do so at their peril. The company slightly missed on earnings but beat on revenue and more importantly issued guidance that initially calmed the fears of the market.  This may be the first step in reversing the negative sentiment that has been building around MSFT stock since November. Another step is the pending acquisition of Activision Blizzard (NASDAQ:ATVI). Activision also reported this week and gave every indication that the company expects the acquisition to go through. Quirke was also analyzing the earnings report issued by Meta Platforms (NASDAQ:FB). The company scored a beat on the bottom line which may put a floor on the stock. And the revenue number fell into the “less bad” range.

Articles by Chris Markoch

At times like this, investors are looking for stocks to buy from companies that deliver dependable earnings and revenue. One place to look at this time is in the commodities sector. And that’s why investors should look at Archer-Daniels-Midland (NYSE:ADM). The company will be a crucial link in the supply chain as the nation and world help to mitigate the effects of inflation. Another stock that investors should consider as we move into the second quarter is Cleveland-Cliffs (NYSE:CLF). In this case, the supply chain is a bullish factor for CLF stock because it gets all of the pig needed for its cold-rolled steel from domestic providers. Another option for investors now, or at any time, would be gold stocks. And for those considering mining stocks, Markoch suggests looking at best-in-class Newmont Corporation (NYSE:NEM) as solid insurance for whatever happens in the market.

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