Coca-Cola: A Top Pick with Strong Pricing Power and Superior Growth Prospects

Morgan Stanley analyst Dara Mohsenian maintained a Buy rating on Coca-Cola (KO – Research Report) today and set a price target of $81.00.

Dara Mohsenian has given his Buy rating due to a combination of factors that highlight Coca-Cola’s strong position in the market. One of the primary reasons is Coca-Cola’s robust and sustained pricing power, which sets it apart from its peers in a challenging consumer packaged goods environment. This pricing strength is expected to maintain Coca-Cola’s long-term organic sales growth at a rate higher than its competitors, who average around 3%, while Coca-Cola is projected to sustain growth in the 5% range.
Furthermore, Mohsenian points to Coca-Cola’s historical volume growth, which remains solid despite significant pricing increases. This growth is supported by market share gains, innovative product offerings, effective marketing strategies, and superior execution compared to its peers. Additionally, Coca-Cola benefits from a favorable competitive landscape, with its peers facing challenges in other product areas, and the growth contribution from its “fairlife” acquisition. These factors collectively make Coca-Cola a top pick in the beverage sector, offering investors a compelling opportunity at a similar valuation to its peers but with superior growth prospects.

According to TipRanks, Mohsenian is a 5-star analyst with an average return of 7.6% and a 63.80% success rate. Mohsenian covers the Consumer Defensive sector, focusing on stocks such as Keurig Dr Pepper, PepsiCo, and Coca-Cola.

In another report released on May 28, Jefferies also reiterated a Buy rating on the stock with a $83.00 price target.