Coca Cola Femsa SAB De CV (KOF) AI Stock Analysis

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Coca Cola Femsa SAB De CV

(NYSE:KOF)

Select Model

Outperform 72 (OpenAI - 5.2)

Rating:72Outperform

Price Target:

$119.00

▲(14.16% Upside)

Action:ReiteratedDate:01/30/26

The score is driven primarily by solid underlying profitability and balance-sheet quality, tempered by weak/volatile TTM cash generation. Technicals remain bullish but look overextended, while valuation is fair with dividend support. The latest earnings call was constructive on execution and cost control, but weighed down by volume softness and Mexico excise-tax and cost/currency headwinds.

Positive Factors

Brand and distribution strength

Exclusive partnership with The Coca‑Cola Company and an extensive distribution network across Mexico, Brazil and Central America creates durable shelf presence, scale advantages and route-to-market density. This structural reach supports steady revenue capture and barriers to entry over years.

Improving profitability and margins

Recent margin expansion and double‑digit revenue growth reflect sustained operational efficiency and effective revenue management. Higher gross and operating margins indicate the company can convert sales into profit reliably, supporting reinvestment, dividend capacity and resilience to cost pressures over the medium term.

Solid cash generation and capital structure

Strong historical free cash flow growth and a moderate leverage profile provide lasting financial flexibility to fund capex, dividends and strategic initiatives. A healthy ROE and equity ratio point to efficient capital use, enabling sustainable funding of growth and liquidity buffers through varying cycles.

Negative Factors

Major excise tax increase in Mexico

An 87% excise tax hike is a structural regulatory shock that will raise prices or compress volumes in Mexico, a core market. Higher tax burdens can permanently alter consumption patterns, pressure unit volumes and force trade‑offs between price, promotions and margin sustainability over multiple years.

Volume weakness in core markets

Persistent volume declines in Mexico and Central America reduce operating leverage in the regions where the company has large scale. Structural softness limits revenue expansion, makes margin maintenance harder, and increases reliance on pricing and mix moves to sustain profitability over the medium term.

Rising debt levels require monitoring

Incrementally higher debt, despite moderate leverage today, reduces long‑term financial flexibility and raises vulnerability to currency swings and interest costs. If cash generation weakens or regional pressures persist, elevated indebtedness could constrain investments or shareholder returns over a multi‑quarter horizon.

Coca Cola Femsa SAB De CV (KOF) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$5.43B

Dividend Yield3.98%

Average Volume (3M)233.50K

Price to Earnings (P/E)15.0

Beta (1Y)0.13

Revenue Growth-2.81%

EPS Growth-2.66%

CountryUS

Employees118,683

SectorConsumer Defensive

Sector Strength42

IndustryBeverages - Non-Alcoholic

Share Statistics

EPS (TTM)1.98

Shares Outstanding52,520,763

10 Day Avg. Volume326,786

30 Day Avg. Volume233,497

Financial Highlights & Ratios

PEG Ratio33.96

Price to Book (P/B)2.45

Price to Sales (P/S)1.23

P/FCF Ratio0.00

Enterprise Value/Market Cap12.23

Enterprise Value/Revenue0.23

Enterprise Value/Gross Profit0.50

Enterprise Value/Ebitda1.42

Forecast

1Y Price Target

$112.17

Price Target Upside7.61% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering6

EPS Forecast (FY)122.36

Revenue Forecast (FY)$308.53B

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 its beverages, which are sold to various retail outlets, including supermarkets, convenience stores, and restaurants. The company benefits from a strong distribution network and an extensive portfolio of Coca-Cola products, which allows it to capture significant market share in its operational regions. Key revenue streams include carbonated soft drinks, non-carbonated beverages, and water products. Additionally, KOF engages in partnerships with The Coca-Cola Company, which provides the brand and product offerings, enhancing customer loyalty and brand recognition. The company also invests in marketing and promotional activities, which help drive sales and increase its market presence.

Coca Cola Femsa SAB De CV Key Performance Indicators (KPIs)

Any

Revenue by Geography

Revenue by Geography
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.

Chart InsightsCoca-Cola FEMSA's revenue in South America shows a steady upward trend, reflecting successful revenue management and favorable market conditions, with recent earnings highlighting an 8.7% revenue increase. However, Mexico & Central America face challenges, including a 2.7% volume decline and a significant excise tax hike impacting future performance. Despite these hurdles, the company is leveraging digital initiatives and cost management to sustain growth, with notable success in markets like Guatemala and Brazil. Investors should watch for how these strategies offset macroeconomic pressures and tax impacts in the coming quarters.

Data provided by:

The Fly

Coca Cola Femsa SAB De CV Earnings Call Summary

Earnings Call Date:Feb 24, 2026

(Q4-2025)

% Change Since: |

Next Earnings Date:Apr 29, 2026

Earnings Call Sentiment Positive

The call conveyed a generally positive tone: the company delivered revenue, EBITDA and net income growth alongside notable market share recoveries, strong product momentum (Coke Zero, Sprite Zero), digital adoption and sustainability achievements. Key challenges include Mexico's consumer softness and the near-term impact of the IEPS excise tax, some margin pressure driven by mix and fixed costs, the need to normalize working capital after ERP-related base effects, and higher financing costs. Management emphasized resilience, prudent capital allocation, and confidence in scaling digital enablers and recovering competitive positions—leading to a cautiously optimistic outlook.

Q4-2025 Updates

Positive Updates

Consolidated Volume and Revenue Growth

Consolidated volume increased 1.3% in Q4 to 1.09 billion unit cases; Q4 total revenues grew 2.9% to MXN 77.7 billion (currency-neutral revenue growth of 6%). December marked the strongest month in company history.

Strong EBITDA and Operating Performance (including insurance recoveries)

Adjusted EBITDA for Q4 increased 12.8% to MXN 18.2 billion with EBITDA margin expanding 210 basis points to 23.4%. Operating income increased 13.3% to MXN 13.7 billion and operating margin expanded 160 basis points to 17.6% (note: both benefited from MXN ~1.1 billion of insurance recoveries).

Resilient Normalized Profitability

Excluding insurance recoveries, normalized adjusted EBITDA grew 4.4% in Q4 with margin expansion of 30 basis points to 21.9%; normalized operating income was down only 2.1% with an operating margin contraction of 90 basis points to 16.1%—reflecting resilience despite headwinds.

Market-Level Volume Wins and Product Momentum

Brazil Q4 volumes +2.6%; Colombia volumes +4.5%; Argentina volumes +3%; Guatemala volumes +3.5%. Coke Zero delivered strong growth: Mexico +14% Y/Y and Brazil +44% in 2025. Sprite Zero grew 93% Y/Y in Brazil and now represents >20% of Sprite volume. Stills growth: consolidated stills portfolio +7.4% in Mexico; Monster +41%, FUZE Tea +33%, Santa Clara +28%.

Digital Adoption and Sales Force Enablement

Juntos+ Advisor rollout completed in Mexico and expanded in Brazil: Mexico geo-efficiency/visitation improved by 5.5 percentage points (91% to 96.5%); Brazil Adviser efficiency improved 9.2pp to 95.6%. Juntos+ monthly active users surpassed target (303,000) and Premier loyalty base rose 73% Y/Y; Colombia digital buyers >320,000 with digital orders +15% and average ticket +4%.

Supply Chain and Capacity Investments

Brazil manufacturing capacity increased 8.2% Y/Y with five new production lines; warehouse capacity increased by >25,000 pallet positions (+6% Y/Y). Mexico planned expansion of cooler doors ( >100,000 by year-end 2026) to improve market execution.

Sustainability Recognition

S&P Global Corporate Sustainability Assessment score rose 11 points to an all-time high of 81; included in the 2026 Sustainability Yearbook as highest scoring company in sector in the Americas and record FTSE4Good score of 4.1/5, with improvements across MSCI, ISS ESG, Bloomberg ESG and CDP.

Majority Net Income Growth

Majority net income increased 3% year-on-year to MXN 7.5 billion despite higher effective tax rate and comprehensive financial results headwinds.

Negative Updates

Mexico Softness and IEPS Excise Tax Impact

Mexico full-year 2025 volumes contracted 0.9% Y/Y (but improved sequentially); company expects a low-to-mid single-digit volume decline in Mexico for 2026 due to the IEPS excise tax increase and continued soft consumer environment. Management remains cautious on further pricing given current elasticities.

Margin Pressure and Unfavorable Mix

Gross profit increased only 1.8% to MXN 36.3 billion in Q4 and gross margin contracted 60 basis points to 46.7% driven by unfavorable mix, hedging positions and fixed costs (labor, depreciation). South America gross margin contracted 170 basis points to 43.7%.

Insurance Recoveries Mask Underlying Trends

Operating income and EBITDA expansions were materially aided by ~MXN 1.1 billion of insurance recoveries in Brazil and Mexico; excluding these the operating income would have declined 2.1% (operating margin -90 bps) and normalized EBITDA growth was a more modest 4.4% (margin +30 bps).

Working Capital and Cash Flow Volatility

Investors noted meaningful cash outflow from working capital in the period that offset EBITDA gains. Company attributed the variance to base effects from a prior increase in accounts payable tied to SAP S/4HANA ERP rollout; management expects normalization starting Q4 2025 / into 1Q 2026.

Higher Financing Expense and FX/Translation Headwinds

Comprehensive financing expense increased to MXN 1.4 billion (from MXN 980 million prior year) driven by lower interest income, a U.S. dollar bond issuance through 2035 and related derivatives. Revenue translation effects from weaker operating currencies into MXN also partially offset revenue growth (management reported stronger currency-neutral growth).

Input Cost Pressure (Aluminum) and Fixed Costs

While sweetener and PET costs were favorable, management flagged pressure from aluminum costs and higher depreciation and labor expenses as headwinds to gross margin recovery and operating leverage.

Company Guidance

Management reiterated a prudent 2026 outlook: they expect a low-to-mid single‑digit volume decline in Mexico (after the IEPS excise tax hit in Q1) and low-to-mid single‑digit volume growth in Brazil, implying consolidated volumes roughly flat to slightly positive for the year; CapEx should fall from 8.2% of revenues in 2025 to about 7.0–7.5% (likely the low end) in 2026 with medium‑term CapEx nearer ~6.5% before stepping up toward 2029/2030 for a new Brazil plant; they will delay any definitive shareholder‑remuneration decision pending first‑half cash‑flow visibility (after completing a MXN 10 billion dual‑ tranche bond issuance — MXN 7bn 10‑yr at 9.12% and MXN 3bn 3‑yr at TA+38bp); operational priorities include rolling out Juntos+ Advisor across the four largest markets, defending household penetration with affordability and returnable packs, and targeting close‑to‑flat EBIT margins by offsetting expected gross‑margin pressure (notably aluminum) with expense and productivity measures (noting December was the strongest month on record).

Coca Cola Femsa SAB De CV Financial Statement Overview

Summary

Solid profitability and improving scale with strong ROE and manageable leverage, but the key drag is the unusually weak and volatile TTM cash flow (free cash flow ~20% of net income), which reduces confidence in near-term cash consistency.

Income Statement

Very Positive

Results show solid, steady profitability with gross margin holding around ~44%–46% over multiple years and EBIT margin generally in the low-to-mid teens. Revenue has expanded meaningfully from 2021–2024, and TTM (Trailing-Twelve-Months) revenue growth is very strong versus the prior period, supporting scale-driven earnings power. Offsetting this, net margin remains only ~6%–8% (modest for the quality of the franchise), and EBITDA margin appears to have compressed in TTM (Trailing-Twelve-Months) versus 2024, suggesting either cost pressure or mix/headwind effects.

Balance Sheet

Positive

Leverage looks manageable: debt runs at roughly ~0.53x–0.72x equity historically and improves into 2023–TTM (Trailing-Twelve-Months), while returns on equity are consistently strong (~13%–17%), indicating efficient use of capital. Total assets and equity have grown over time, supporting balance-sheet durability. The main watch-outs are that absolute debt remains sizable and leverage is not low, leaving the company more exposed if rates rise further or if operating performance softens.

Cash Flow

Neutral

Annual cash generation was strong in 2021–2024, with operating cash flow generally supporting healthy free cash flow and decent conversion versus net income in those years. However, TTM (Trailing-Twelve-Months) cash flow appears unusually weak versus earnings (free cash flow is only ~20% of net income), and operating cash flow is far below prior annual levels—pointing to potential working-capital drag, timing effects, or higher cash uses. Free cash flow growth is also highly volatile (sharp swings across years), which reduces confidence in near-term cash consistency.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	291.75B	279.79B	245.09B	226.74B	194.80B
Gross Profit	133.18B	128.74B	110.86B	100.30B	88.60B
EBITDA	55.18B	52.85B	43.82B	40.45B	37.33B
Net Income	23.84B	23.73B	19.54B	19.03B	15.71B
Balance Sheet
Total Assets	314.54B	307.99B	273.52B	278.00B	271.57B
Cash, Cash Equivalents and Short-Term Investments	28.07B	32.78B	31.06B	40.28B	47.25B
Total Debt	82.68B	78.39B	69.31B	80.80B	87.29B
Total Liabilities	160.51B	157.44B	139.81B	146.12B	144.00B
Stockholders Equity	146.20B	143.43B	127.03B	125.39B	121.55B
Cash Flow
Free Cash Flow	0.00	16.65B	21.66B	17.76B	22.73B
Operating Cash Flow	0.00	42.44B	42.29B	35.49B	32.72B
Investing Cash Flow	0.00	-23.39B	-20.07B	-19.60B	-9.55B
Financing Cash Flow	0.00	-19.64B	-26.35B	-20.85B	-20.26B

Coca Cola Femsa SAB De CV Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price104.24

Price Trends

50DMA

104.53

Negative

100DMA

96.07

Positive

200DMA

91.26

Positive

Market Momentum

MACD

0.37

Positive

RSI

42.27

Neutral

STOCH

22.23

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 104.24 is below the 20-day moving average (MA) of 110.45, below the 50-day MA of 104.53, and above the 200-day MA of 91.26, indicating a neutral trend. The MACD of 0.37 indicates Positive momentum. The RSI at 42.27 is Neutral, neither overbought nor oversold. The STOCH value of 22.23 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

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

Product safety and quality concerns could negatively affect our business. Q4, 2023

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
KO	76 Outperform	$331.33B	22.95	44.35%	2.92%	2.93%	25.42%
KOF	72 Outperform	$5.43B	15.03	16.56%	3.98%	-2.81%	-2.66%
PEP	70 Outperform	$217.88B	23.92	43.03%	3.91%	0.48%	-22.61%
CCEP	69 Neutral	$45.02B	18.87	24.39%	2.52%	9.65%	-4.26%
KDP	69 Neutral	$38.38B	18.30	8.29%	3.12%	6.77%	-29.84%
COKE	68 Neutral	$13.61B	19.79	168.34%	0.61%	4.22%	22.24%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%

* Consumer Defensive Sector Average

Performance Comparison

KOF

Coca Cola Femsa SAB De CV

104.24

22.58

27.65%

COKE

Coca-Cola Bottling Co Consolidated

204.39

82.57

67.78%

Coca-Cola

77.04

7.64

11.01%

KDP

Keurig Dr Pepper

28.25

-3.30

-10.45%

PEP

PepsiCo

159.43

9.20

6.12%

CCEP

Coca-Cola Europacific Partners

100.22

21.35

27.07%

Coca Cola Femsa SAB De CV Corporate Events

Coca-Cola FEMSA Announces Board Changes Effective November 2025

Nov 3, 2025

On November 3, 2025, Coca-Cola FEMSA announced changes to its Board of Directors, effective November 1, 2025. Mr. Jose Antonio Fernández Garza Lagüera was appointed as a Director following the passing of Mr. Ricardo Guajardo Touché, and Mr. Jose Luis Cutrale, Jr. was appointed as the new alternate Director for José Henrique Cutrale after Mrs. Graziela Cutrale’s resignation. These changes reflect the company’s ongoing governance adjustments and may impact its strategic direction.

The most recent analyst rating on (KOF) stock is a Buy with a $98.00 price target. To see the full list of analyst forecasts on Coca Cola Femsa SAB De CV stock, see the KOF Stock Forecast page.

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.Date of analysis: Jan 30, 2026