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
Be a smarter, better informed investor.
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
-
Stock Market Winners and Losers of the 'Big, Beautiful' BillDefense, manufacturing and tech should prosper, while health care and green energy stocks face hurdles.
-
I'm a Financial Planner: Here's How to Invest Like the Wealthy, Even if You Don't Have MillionsPrivate market investments, once exclusive to the ultra-wealthy and institutions, have become more accessible to individual investors, thanks to regulatory changes and new investment structures.
-
Four Ways a Massive Emergency Fund Can Hurt You More Than It HelpsSaving too much could mean you're missing opportunities to put your money to work. Redirect some of that money toward paying off debt, building retirement funds, fulfilling a dream or investing in higher-growth options.
-
With Buffett Retiring, Should You Invest in a Berkshire Copycat?Warren Buffett will step down at the end of this year. Should you explore one of a handful of Berkshire Hathaway clones or copycat funds?
-
I'm a Financial Planner: How to Dodge a Retirement Danger You May Not Have Heard AboutTiming is everything, and sequence of returns risk can mean the difference between a retirement nest egg that's overflowing … or empty.
-
Caring for Aging Parents: An Expert Guide to Easing the Financial and Emotional StrainEarly conversations, financial planning and understanding the progression of care needs can help to mitigate stress and protect family relationships.
-
Dow Adds 238 Points as UNH, CAT Pop: Stock Market TodayThe lack of a September jobs report didn't seem to worry market participants, with the data delayed due to the ongoing government shutdown.
-
I'm a Financial Adviser: The OBBB Is a Reminder for Older People to Have a Long-Term PlanThe new tax bill presents a good opportunity for retirees to revisit tax plans, look into doing some Roth conversions and consider plans for long-term care.
