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Coca-Cola (KO) Dips More Than Broader Markets: What You Should Know

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Coca-Cola (KO - Free Report) closed at $56.73 in the latest trading session, marking a -0.07% move from the prior day. This move lagged the S&P 500's daily loss of 0.03%.

Coming into today, shares of the world's largest beverage maker had gained 0.48% in the past month. In that same time, the Consumer Staples sector gained 0.69%, while the S&P 500 gained 3.59%.

Wall Street will be looking for positivity from KO as it approaches its next earnings report date. The company is expected to report EPS of $0.58, up 5.45% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $9.63 billion, up 11.3% from the prior-year quarter.

KO's full-year Zacks Consensus Estimates are calling for earnings of $2.25 per share and revenue of $37.86 billion. These results would represent year-over-year changes of +15.38% and +14.69%, respectively.

It is also important to note the recent changes to analyst estimates for KO. 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 company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 0.22% higher within the past month. KO is currently a Zacks Rank #2 (Buy).

Looking at its valuation, KO is holding a Forward P/E ratio of 25.23. This valuation marks a premium compared to its industry's average Forward P/E of 24.2.

Investors should also note that KO has a PEG ratio of 2.91 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Beverages - Soft drinks industry currently had an average PEG ratio of 2.52 as of yesterday's close.

The Beverages - Soft drinks industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 117, putting it in the top 47% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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