Coca-Cola (KO) stock is trading lower Wednesday even after the soda pop maker beat top- and bottom-line expectations for its third quarter.
In the three months ended September 27, Coca-Cola's net revenue decreased 0.8% year-over-year to $11.9 billion. However, organic revenue, which excludes certain items such as acquisitions and currency, increased 9%. Meanwhile, the company said earnings per share (EPS) were up 5% from the year-ago period to 77 cents.
The results came in ahead of analysts' expectations. Wall Street was anticipating revenue of $11.6 billion and earnings of 74 cents per share, according to Yahoo Finance.
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
"We are encouraged by our year-to-date performance and our system's ability to manage near-term challenges while also remaining focused on long-term growth opportunities," said Coca-Cola CEO James Quincey in a statement.
As a result of its performance in the first nine months of the year, Coca-Cola said it now anticipates organic revenue growth of approximately 10% in fiscal 2024, which is the high-end of its prior range of 9% to 10%. It added that it continues to anticipate earnings-per-share growth in the range of 5% to 6%.
Is Coca-Cola stock a buy, sell or hold?
Coca-Cola is one of the better-performing Dow Jones stocks this year, up 20% on a total return basis (price change plus dividends). And Wall Street thinks the consumer staples stock has more room to run.
According to S&P Global Market Intelligence, the average analyst target price for KO stock is $74.80, representing implied upside of about 10% to current levels. Additionally, the consensus recommendation is a Buy.
Despite this vote of confidence from Wall Street and the fact that KO is one of Warren Buffett's favorite stocks, not everyone is in the bull camp.
Indeed, financial services firm CFRA Research maintained a Hold rating on Coca-Cola after earnings and lowered its price target on the stock to $70 from $72.
"With KO shares having rebounded over the past several months to a record high in September, we maintain a Hold on valuation and headwinds from both currency and volume growth," says CFRA Research analyst Garrett Nelson.
"We thought the fact KO didn't raise guidance was a modest disappointment following the better-than-expected Q3 results," Nelson adds, which could explain the stock's post-earnings slump.
Related Content
-
I'm want to give my 3 grandkids $5K each for Christmas.You're comfortably retired and want to give your grandkids a big Christmas check, but their parents are worried they might spend it all. We ask the pros for help.
-
If You're Not Doing Roth Conversions, You Need to Read ThisRoth conversions and other Roth strategies can be complex, but don't dismiss these tax planning tools outright. They could really work for you and your heirs.
-
Could Traditional Retirement Expectations Be Killing Us?A retirement psychologist makes the case: A fulfilling retirement begins with a blueprint for living, rather than simply the accumulation of a large nest egg.
-
I'm a Financial Planner: If You're Not Doing Roth Conversions, You Need to Read This
Roth conversions and other Roth strategies can be complex, but don't dismiss these tax planning tools outright. They could really work for you and your heirs.
-
Could Traditional Retirement Expectations Be Killing Us? A Retirement Psychologist Makes the Case
A retirement psychologist makes the case: A fulfilling retirement begins with a blueprint for living, rather than simply the accumulation of a large nest egg.
-
I'm a Financial Adviser: This Is How You Can Adapt to Social Security UncertaintyRather than letting the unknowns make you anxious, focus on building a flexible income strategy that can adapt to possible future Social Security changes.
-
I'm a Financial Planner for Millionaires: Here's How to Give Your Kids Cash Gifts Without Triggering IRS PaperworkMost people can gift large sums without paying tax or filing a return, especially by structuring gifts across two tax years or splitting gifts with a spouse.
-
'Boomer Candy' Investments Might Seem Sweet, But They Can Have a Sour AftertasteProducts such as index annuities, structured notes and buffered ETFs might seem appealing, but sometimes they can rob you of flexibility and trap your capital.
-
AI Stocks Lead Nasdaq's 398-Point Nosedive: Stock Market TodayThe major stock market indexes do not yet reflect the bullish tendencies of sector rotation and broadening participation.
-
Got $100 to Gamble? These Penny Stocks Could Be Worth the RideVolatile penny stocks are high-risk plays with potentially high rewards. If you have $100 you can afford to lose, these three names are worth a look.
-
Quick Question: Are You Planning for a 20-Year Retirement or a 30-Year Retirement?You probably should be planning for a much longer retirement than you are. To avoid running out of retirement savings, you really need to make a plan.
