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Coca Cola Femsa SAB De CV (KOF)
NYSE:KOF
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Coca Cola Femsa SAB De CV
(NYSE:KOF)
Rating:70Outperform
Price Target:
$96.00
â–²(11.97% Upside)
Positive Factors
Revenue Growth
Despite volume declines, revenue growth indicates effective pricing strategies and currency benefits, supporting long-term financial health.
Market Share in Brazil
Gains in Brazil's market share, especially in key beverage categories, highlight competitive strength and potential for sustained growth.
Capacity Expansion
Capacity expansions enhance production capabilities, supporting future growth and operational efficiency, crucial for market demand.
Negative Factors
Volume Decline
Volume declines in key markets could impact revenue and profitability if not addressed, posing a risk to long-term growth.
Operating Margin Contraction
Margin contraction indicates cost pressures and reduced profitability, challenging the company's ability to maintain strong financial performance.
Challenges in Mexico
Significant volume decline in Mexico, a major market, highlights vulnerability to economic and weather-related disruptions, affecting stability.
Coca Cola Femsa SAB De CV (KOF) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.58B
Dividend Yield3.89%
Average Volume (3M)207.61K
Price to Earnings (P/E)15.3
Beta (1Y)0.28
Revenue Growth-4.05%
EPS Growth-3.69%
CountryUS
Employees118,683
SectorConsumer Defensive
Sector Strength42
IndustryBeverages - Non-Alcoholic
Share Statistics
EPS (TTM)1.73
Shares Outstanding52,520,763
10 Day Avg. Volume282,445
30 Day Avg. Volume207,610
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap5.07
Enterprise Value/Revenue0.08
Enterprise Value/Gross Profit0.17
Enterprise Value/Ebitda0.56
Forecast
1Y Price Target
$106.25Price Target Upside23.92% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
Coca Cola Femsa SAB De CV Business Overview & Revenue Model
Company DescriptionCoca-Cola FEMSA, S.A.B. de C.V., a franchise bottler, produces, markets, sells, and distributes Coca-Cola trademark beverages. The company offers sparkling beverages, including colas and flavored sparkling beverages; and waters and other beverages, such as juice drinks, coffee, teas, milk, value-added dairy products, sports and energy drinks, and plant-based drinks. It provides a portfolio of products through retail outlets, such as wholesale supermarkets, discount stores, and convenience stores; retailers, such as restaurants and bars, as well as stadiums, auditoriums, and theaters; points-of-sale outlets; and home delivery, supermarkets, and other locations. In addition, the company distributes and sells Heineken beer products in its Brazilian territories. It operates in Mexico, Guatemala, Nicaragua, Costa Rica, Panama, Colombia, Brazil, Argentina, and Uruguay. The company was founded in 1979 and is headquartered in Mexico City, Mexico. Coca-Cola FEMSA, S.A.B. de C.V. is a subsidiary of Fomento Economico Mexicano, S.A.B. de C.V.
How the Company Makes MoneyCoca Cola Femsa generates revenue primarily through the sale of beverages. Its revenue model is based on the production and distribution of Coca-Cola products, as well as other soft drinks and non-carbonated beverages. Key revenue streams include the sale of bottled and canned beverages to retailers, convenience stores, and food service outlets. Additionally, KOF benefits from economies of scale due to its extensive distribution network and large volume sales. The company also engages in promotional partnerships and marketing campaigns that enhance brand visibility and drive sales. Factors contributing to earnings include market demand for beverages, pricing strategies, and operational efficiency in production and distribution.
Coca Cola Femsa SAB De CV Earnings Call Summary
Earnings Call Date:Jul 23, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Oct 22, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture with some positive revenue growth and strategic market share gains, particularly in Argentina and Brazil. However, significant challenges in Mexico and a decline in consolidated volumes across key markets were notable. Increased operating expenses and interest costs further weighed down the overall financial performance.Q2-2025 Updates
Positive Updates
Revenue Growth
Total revenues for the quarter grew by 5%, reaching MXN 72.9 billion, despite a decline in consolidated volume of 5.5%. On a neutral currency basis, total revenues increased by 2.4%.
Performance in Argentina
Argentina's volumes increased by 11.9%, with macro indicators improving and monthly inflation falling below 2%. The country saw a strong performance in the flavors portfolio with 6.2% growth.
Improved Market Share in Brazil
Brazil achieved record share in the nonalcoholic ready-to-drink segment, driven by gains in sparkling beverages, juices, sports drinks, and water categories. Coca-Cola Zero volumes increased by 56% year-on-year.
Capacity Expansion Initiatives
Key projects in Toluca, San Juan del RÃo, and the Southeast region were completed, adding significant capacity in terms of warehouse space and production lines.
Negative Updates
Volume Decline in Key Markets
Consolidated volume declined by 5.5% due to decreases in Mexico, Brazil, Colombia, and Panama. Mexico's volume declined by 10%, impacted by a challenging macro environment and adverse weather.
Operating Margin Contraction
Gross margin contracted by 70 basis points to 45.3%, and operating income remained flat with an operating margin contraction of 60 basis points to 13.4%. EBITDA margin also contracted by 160 basis points to 18.4%.
Challenges in Mexico
Mexico faced a 10% volume decline due to a softer macroeconomic backdrop and adverse weather conditions, including the rainiest June in over 50 years.
Increased Interest Expenses
Majority net income decreased by 5.3% to MXN 5.3 billion, driven mainly by higher interest expenses and a lower foreign exchange gain, coupled with a higher effective tax rate.
Company Guidance
During Coca-Cola FEMSA's second quarter 2025 conference call, the company reported a 5.5% decline in consolidated volume to 1.035 million unit cases, although total revenues increased by 5% to MXN 72.9 billion, aided by revenue management initiatives and favorable currency translations. The gross profit rose 3.4% to MXN 33 billion, despite a 70 basis point contraction in margin to 45.3%, due to lower operating leverage and unfavorable mix effects. Operating income remained flat at MXN 9.7 billion, with the operating income margin contracting by 60 basis points to 13.4%. Adjusted EBITDA decreased by 3.8% to MXN 13.4 billion, with the EBITDA margin contracting by 160 basis points to 18.4%. Majority net income saw a decline of 5.3% to MXN 5.3 billion, primarily attributed to higher interest expenses and a lower foreign exchange gain. The company noted specific challenges in Mexico and Brazil due to macroeconomic conditions and adverse weather, respectively, and highlighted strategic initiatives to address these challenges, including capacity expansions and promotional activities.Coca Cola Femsa SAB De CV Financial Statement Overview
Summary
Coca Cola Femsa has shown strong financial health with robust revenue and profit growth, supported by effective cost management and operational efficiency. The balance sheet is solid with moderate leverage, though attention to debt levels is advisable. Cash flow data is incomplete, but historical performance indicates solid cash generation.Income Statement
Coca Cola Femsa demonstrated robust revenue growth of 14.15% YoY in 2024, driven by strong market demand. Gross profit margin improved to 46.01%, reflecting effective cost management. Net profit margin also increased to 8.48%, indicating enhanced profitability. EBIT and EBITDA margins were healthy at 14.35% and 18.41% respectively, showing strong operational performance. The company has shown consistent growth in revenues and profitability over the years.85
Very Positive
Balance Sheet
The balance sheet remains solid with a debt-to-equity ratio of 0.54, suggesting moderate leverage. Return on equity (ROE) improved to 16.55%, indicating effective utilization of equity. The equity ratio stands at 46.57%, reflecting a healthy capital structure. The company has maintained a stable equity base, though total debt levels have increased slightly compared to the previous year, necessitating careful management.78
Positive
Cash Flow
Cash flow analysis is limited due to missing current year data, but historical performance shows strong free cash flow generation, with a significant free cash flow growth rate of 21.98% in 2023. The company has maintained a positive free cash flow to net income ratio, ensuring sufficient cash generation to support operations. Attention to future cash flow stability is crucial as recent data is unavailable.60
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 288.60B | 279.79B | 245.09B | 226.74B | 194.80B | 183.62B |
| Gross Profit | 132.82B | 128.74B | 110.86B | 100.30B | 88.60B | 82.81B |
| EBITDA | 41.46B | 52.85B | 43.82B | 40.45B | 37.33B | 32.44B |
| Net Income | 23.59B | 23.73B | 19.54B | 19.03B | 15.71B | 10.31B |
Balance Sheet | ||||||
| Total Assets | 313.86B | 307.99B | 273.52B | 278.00B | 271.57B | 263.07B |
| Cash, Cash Equivalents and Short-Term Investments | 37.14B | 32.78B | 31.06B | 40.28B | 47.25B | 43.50B |
| Total Debt | 84.50B | 78.39B | 67.73B | 80.81B | 87.29B | 88.78B |
| Total Liabilities | 169.12B | 157.44B | 139.81B | 146.12B | 144.00B | 140.61B |
| Stockholders Equity | 136.94B | 143.43B | 127.03B | 125.38B | 121.55B | 116.87B |
Cash Flow | ||||||
| Free Cash Flow | 314.39M | 16.65B | 21.66B | 17.76B | 22.73B | 60.35B |
| Operating Cash Flow | 1.57B | 42.44B | 42.29B | 35.49B | 32.72B | 70.29B |
| Investing Cash Flow | -1.34B | -23.39B | -20.07B | -19.60B | -9.55B | -21.02B |
| Financing Cash Flow | -335.71M | -19.64B | -26.35B | -20.85B | -20.26B | 834.00M |
Coca Cola Femsa SAB De CV Technical Analysis
Neutral
85.74
Price Trends
86.20
Negative
90.15
Negative
86.17
Negative
Market Momentum
-0.24
Negative
51.71
Neutral
78.41
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KOF, the sentiment is Neutral. The current price of 85.74 is above the 20-day moving average (MA) of 84.82, below the 50-day MA of 86.20, and below the 200-day MA of 86.17, indicating a neutral trend. The MACD of -0.24 indicates Negative momentum. The RSI at 51.71 is Neutral, neither overbought nor oversold. The STOCH value of 78.41 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for KOF.
Coca Cola Femsa SAB De CV Risk Analysis
Coca Cola Femsa SAB De CV disclosed 27 risk factors in its most recent earnings report. Coca Cola Femsa SAB De CV reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 3 New Risks
1.
If we fail to comply with privacy and data protection laws, we could be subject to adverse publicity, business disruption, data loss, government enforcement actions and/or private litigation, any of which could negatively affect our business and operating results. Q4, 2023
2.
Product safety and quality concerns could negatively affect our business. Q4, 2023
3.
Pandemics and public health crises, may adversely affect our business, financial condition and results of operations. Q4, 2023
Coca Cola Femsa SAB De CV Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $10.60B | 20.32 | 41.45% | 4.87% | 3.22% | 23.88% | |
76 Outperform | $197.46B | 26.30 | 39.88% | 3.87% | -0.34% | -20.51% | |
74 Outperform | $288.39B | 23.74 | 44.76% | 2.97% | 1.34% | 14.67% | |
73 Outperform | $41.50B | 24.80 | 17.99% | 2.47% | 9.65% | -4.26% | |
70 Outperform | $4.58B | 15.33 | 16.78% | 3.89% | -4.05% | -3.69% | |
67 Neutral | $36.99B | 24.16 | 6.18% | 3.38% | 4.63% | -28.22% | |
62 Neutral | $20.51B | 14.76 | -3.31% | 3.19% | 1.94% | -10.37% |
* Consumer Defensive Sector Average
Performance Comparison
KOF
Coca Cola Femsa SAB De CV
85.74
-0.53
-0.61%
COKE
Coca-Cola Bottling Co Consolidated
121.98
-5.05
-3.98%
KO
Coca-Cola
67.01
-3.52
-4.99%
KDP
Keurig Dr Pepper
27.23
-9.12
-25.09%
PEP
PepsiCo
143.53
-27.09
-15.88%
CCEP
Coca-Cola Europacific Partners
89.71
10.05
12.62%
Coca Cola Femsa SAB De CV Corporate Events
Coca-Cola FEMSA Reports Q2 2025 Results Amid Challenging Conditions
Jul 23, 2025
Coca-Cola FEMSA announced its second-quarter 2025 results, reporting a 5.5% decline in volume but a 5.0% increase in revenue. Despite challenges such as a softer macroeconomic environment in Mexico and adverse weather conditions in Mexico and Brazil, the company maintained its operating income and improved its competitive position. The company also issued senior notes worth $500 million, reflecting strong investor demand and confirming its financial discipline. Additionally, Coca-Cola FEMSA was included in the FTSE4Good sustainability indices for the tenth consecutive year, showcasing its progress in sustainability efforts.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.