Coca-Cola (KO) closed at $67.94 in the latest trading session, marking a -1.71% move from the prior day. This change lagged the S&P 500's 0.64% gain on the day. Elsewhere, the Dow gained 1.23%, while the tech-heavy Nasdaq added 0.69%.
Prior to today's trading, shares of the world's largest beverage maker had lost 1.26% lagged the Consumer Staples sector's loss of 0.94% and the S&P 500's gain of 0.55%.
The investment community will be paying close attention to the earnings performance of Coca-Cola in its upcoming release. The company's earnings per share (EPS) are projected to be $0.56, reflecting a 1.82% increase from the same quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $12.07 billion, up 4.53% from the year-ago period.
KO's full-year Zacks Consensus Estimates are calling for earnings of $2.98 per share and revenue of $48.33 billion. These results would represent year-over-year changes of +3.47% and 0%, respectively.
It is also important to note the recent changes to analyst estimates for Coca-Cola. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.03% decrease. Coca-Cola is currently a Zacks Rank #4 (Sell).
Digging into valuation, Coca-Cola currently has a Forward P/E ratio of 21.47. Its industry sports an average Forward P/E of 16.78, so one might conclude that Coca-Cola is trading at a premium comparatively.
One should further note that KO currently holds a PEG ratio of 3.56. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The Beverages - Soft drinks was holding an average PEG ratio of 2.03 at yesterday's closing price.
The Beverages - Soft drinks industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 201, putting it in the bottom 18% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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CocaCola Company (The) (KO): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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