Shares of the Coca-Cola Company (KO) were on the rise in pre-market trading after the beverage giant upgraded its forecast for FY24 and reported stronger-than-expected Q2 results. The company announced adjusted earnings of $0.84 per share, marking a 7% increase year-over-year, and surpassing analysts’ expectations of $0.81 per share.
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KO’s Revenues in Q2
In Q2, Coca-Cola generated net revenues of $12.4 billion, a 3% increase from the previous year, exceeding consensus estimates of $11.8 billion. Unit case volume grew by 2% for the quarter, driven by growth in “mid-single digits” in developing and emerging markets, particularly in India, Brazil, and the Philippines.
KO Is Expanding Internationally
Coca-Cola is ramping up its presence in Asia and Europe and is introducing new product variations, such as Coke Spiced and Georgia Coffee, to sustain revenue growth in price-sensitive markets. The company’s average selling price rose by 9% in the second quarter. However, North American volumes declined by 1% as consumers remained cautious with their spending.
According to TipRanks “Bulls Say, Bears Say,” analysts bullish about KO are upbeat about the company’s foray into international markets and believe that “strong international trends and higher international exposure are benefiting Coca-Cola, given international organic sales growth is holding up much better than North America.”
KO’s Guidance for FY24
Looking forward, for FY24, the company expects its organic sales to grow between 9% and 10%, compared with its prior forecast of an 8% to 9% rise. KO has forecasted its adjusted earnings to increase between 5% and 6%, compared with its previous forecast of a rise of 4% to 5%.
Is KO Stock a Good Buy?
Analysts remain bullish about KO stock, with a Strong Buy consensus rating based on 14 Buys and two Holds. Year-to-date, KO has increased by more than 10%, and the average KO price target of $69.50 implies an upside potential of 7.3% from current levels. These analyst ratings are likely to change following KO’s results today.
