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Factors Likely to Support Coca-Cola's (KO) Earnings Beat in Q4
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The Coca-Cola Company (KO - Free Report) is expected to register top-line growth when it reports fourth-quarter 2022 numbers on Feb 14, before the opening bell. The Zacks Consensus Estimate for the company’s fourth-quarter revenues is pegged at $10.01 billion, suggesting 5.7% growth from the prior-year quarter’s reported figure.
For fourth-quarter earnings, the consensus mark is pegged at 45 cents, suggesting flat results from the year-ago quarter’s reported figure. The consensus mark has moved down 4.3% in the past 30 days.
The Zacks Consensus Estimate for the company’s 2022 revenues is pegged at $42.9 billion, suggesting 10.9% growth from the prior-year quarter’s reported figure. For 2022 earnings, the consensus mark for earnings is pegged at $2.48, suggesting growth of 6.9% from the year-ago quarter’s reported figure. The consensus mark has been unchanged in the past 30 days.
We expect the company’s fourth-quarter total revenues to increase 1.5% year over year to $9,603.7 million and the bottom line to decline 2% to 44 cents per share. For 2022, we estimate revenue growth of 9.9% to $42,482.7 million and earnings per share growth of 6.6% to $2.47.
In the last reported quarter, the leading soft-drink behemoth delivered an earnings surprise of 7.8%. Its bottom line beat the Zacks Consensus Estimate by 8.8%, on average, over the trailing four quarters.
Coca-Cola’s performances in recent quarters have been benefiting from strategic transformation and ongoing recovery around the world. The company’s fourth-quarter performance is expected to have benefited from revenue growth across its operating segments, aided by an improved price/mix and an increase in concentrate sales. Underlying share gains in both at-home and away-from-home channels are also expected to have bolstered the performance.
The company’s volumes in the fourth quarter are expected to have benefited from the ongoing recovery in markets. Category-wise, volume has been benefiting from growth in trademark Coca-Cola; sparkling flavors; the nutrition, juice, dairy and plant-based beverages; and hydration, sports, coffee and tea categories.
Coca-Cola’s fourth-quarter results are likely to reflect gains from innovations and accelerating digital investments. The company has been witnessing a splurge in e-commerce with the growth rate of the channel doubling in many countries. KO has been accelerating investments to build strong digital capabilities. The company has been consistently strengthening consumer connections and piloting various digital-enabled initiatives through fulfillment methods to capture the online demand, which are likely to have boosted fourth-quarter sales.
However, Coca-Cola has been witnessing pressures from higher supply-chain costs, including rising commodity input costs and transportation expenses. The pressures from input cost inflation and other costs are likely to have hurt the company’s performance in the fourth quarter.
Coca-Cola has been investing in its markets and brands to support sales growth with higher spending on consumer-facing activities. This has led to higher marketing investments in the past few quarters. Higher marketing spending and an increase in short-term incentives and stock-based compensation are expected to have led to increased selling, general and administrative expenses in the fourth quarter.
On the last reported quarter’s earnings call, the company expected adverse currency rates to hurt the top and bottom lines in the fourth quarter. It expects a currency headwind of 8% on comparable revenues and 9% on comparable earnings per share for the fourth quarter.
Zacks Model
Our proven model conclusively predicts an earnings beat for Coca-Cola this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Coca-Cola has a Zacks Rank #2 and an Earnings ESP of +0.75%.
Stocks Likely to Beat on Earnings
Here are some companies that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this quarter:
Inter Parfums (IPAR - Free Report) has an Earnings ESP of +13.33% and it currently carries a Zacks Rank of 2. The company is likely to register top- and bottom-line growth when it reports fourth-quarter 2022 results. The consensus mark for IPAR’s quarterly revenues is pegged at $311.5 million, which suggests 47.8% growth from the figure reported in the prior-year quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus mark for Inter Parfums’ quarterly earnings has moved up by a penny in the past 30 days to 30 cents per share. The consensus estimate for IPAR’s fourth-quarter earnings suggests growth of 850% from the year-ago quarter’s reported figure.
Molson Coors (TAP - Free Report) currently has an Earnings ESP of +3.49% and a Zacks Rank of 3. The company is likely to register increases in the top and bottom lines when it reports fourth-quarter 2022 results. The Zacks Consensus Estimate for TAP’s quarterly earnings has moved up by a penny in the past 30 days to $1.06 per share. The consensus estimate indicates growth of 30.9% from the year-ago quarter's loss per share of 9 cents.
Molson Coors’ top line is expected to have risen year over year. The Zacks Consensus Estimate for TAP’s quarterly revenues is pegged at $2.68 billion, suggesting growth of 2.4% from the figure reported in the prior-year quarter. TAP has delivered an earnings surprise of 12.3%, on average, in the trailing four quarters.
Kellogg's (K - Free Report) currently has an Earnings ESP of +4.12% and a Zacks Rank of 3. The company is likely to register increases in the top and bottom lines when it reports fourth-quarter 2022 results. The Zacks Consensus Estimate for quarterly revenues is pegged at $3.7 billion, which suggests a rise of 6.9% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for Kellogg’s quarterly earnings has been unchanged at 84 cents per share in the past 30 days. The consensus mark for K suggests 1.2% growth from the year-ago quarter’s reported number. K has delivered an earnings beat of 10.6%, on average, in the trailing four quarters.
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Factors Likely to Support Coca-Cola's (KO) Earnings Beat in Q4
The Coca-Cola Company (KO - Free Report) is expected to register top-line growth when it reports fourth-quarter 2022 numbers on Feb 14, before the opening bell. The Zacks Consensus Estimate for the company’s fourth-quarter revenues is pegged at $10.01 billion, suggesting 5.7% growth from the prior-year quarter’s reported figure.
For fourth-quarter earnings, the consensus mark is pegged at 45 cents, suggesting flat results from the year-ago quarter’s reported figure. The consensus mark has moved down 4.3% in the past 30 days.
The Zacks Consensus Estimate for the company’s 2022 revenues is pegged at $42.9 billion, suggesting 10.9% growth from the prior-year quarter’s reported figure. For 2022 earnings, the consensus mark for earnings is pegged at $2.48, suggesting growth of 6.9% from the year-ago quarter’s reported figure. The consensus mark has been unchanged in the past 30 days.
We expect the company’s fourth-quarter total revenues to increase 1.5% year over year to $9,603.7 million and the bottom line to decline 2% to 44 cents per share. For 2022, we estimate revenue growth of 9.9% to $42,482.7 million and earnings per share growth of 6.6% to $2.47.
In the last reported quarter, the leading soft-drink behemoth delivered an earnings surprise of 7.8%. Its bottom line beat the Zacks Consensus Estimate by 8.8%, on average, over the trailing four quarters.
CocaCola Company (The) Price and EPS Surprise
CocaCola Company (The) price-eps-surprise | CocaCola Company (The) Quote
Key Points to Note
Coca-Cola’s performances in recent quarters have been benefiting from strategic transformation and ongoing recovery around the world. The company’s fourth-quarter performance is expected to have benefited from revenue growth across its operating segments, aided by an improved price/mix and an increase in concentrate sales. Underlying share gains in both at-home and away-from-home channels are also expected to have bolstered the performance.
The company’s volumes in the fourth quarter are expected to have benefited from the ongoing recovery in markets. Category-wise, volume has been benefiting from growth in trademark Coca-Cola; sparkling flavors; the nutrition, juice, dairy and plant-based beverages; and hydration, sports, coffee and tea categories.
Coca-Cola’s fourth-quarter results are likely to reflect gains from innovations and accelerating digital investments. The company has been witnessing a splurge in e-commerce with the growth rate of the channel doubling in many countries. KO has been accelerating investments to build strong digital capabilities. The company has been consistently strengthening consumer connections and piloting various digital-enabled initiatives through fulfillment methods to capture the online demand, which are likely to have boosted fourth-quarter sales.
However, Coca-Cola has been witnessing pressures from higher supply-chain costs, including rising commodity input costs and transportation expenses. The pressures from input cost inflation and other costs are likely to have hurt the company’s performance in the fourth quarter.
Coca-Cola has been investing in its markets and brands to support sales growth with higher spending on consumer-facing activities. This has led to higher marketing investments in the past few quarters. Higher marketing spending and an increase in short-term incentives and stock-based compensation are expected to have led to increased selling, general and administrative expenses in the fourth quarter.
On the last reported quarter’s earnings call, the company expected adverse currency rates to hurt the top and bottom lines in the fourth quarter. It expects a currency headwind of 8% on comparable revenues and 9% on comparable earnings per share for the fourth quarter.
Zacks Model
Our proven model conclusively predicts an earnings beat for Coca-Cola this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Coca-Cola has a Zacks Rank #2 and an Earnings ESP of +0.75%.
Stocks Likely to Beat on Earnings
Here are some companies that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this quarter:
Inter Parfums (IPAR - Free Report) has an Earnings ESP of +13.33% and it currently carries a Zacks Rank of 2. The company is likely to register top- and bottom-line growth when it reports fourth-quarter 2022 results. The consensus mark for IPAR’s quarterly revenues is pegged at $311.5 million, which suggests 47.8% growth from the figure reported in the prior-year quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus mark for Inter Parfums’ quarterly earnings has moved up by a penny in the past 30 days to 30 cents per share. The consensus estimate for IPAR’s fourth-quarter earnings suggests growth of 850% from the year-ago quarter’s reported figure.
Molson Coors (TAP - Free Report) currently has an Earnings ESP of +3.49% and a Zacks Rank of 3. The company is likely to register increases in the top and bottom lines when it reports fourth-quarter 2022 results. The Zacks Consensus Estimate for TAP’s quarterly earnings has moved up by a penny in the past 30 days to $1.06 per share. The consensus estimate indicates growth of 30.9% from the year-ago quarter's loss per share of 9 cents.
Molson Coors’ top line is expected to have risen year over year. The Zacks Consensus Estimate for TAP’s quarterly revenues is pegged at $2.68 billion, suggesting growth of 2.4% from the figure reported in the prior-year quarter. TAP has delivered an earnings surprise of 12.3%, on average, in the trailing four quarters.
Kellogg's (K - Free Report) currently has an Earnings ESP of +4.12% and a Zacks Rank of 3. The company is likely to register increases in the top and bottom lines when it reports fourth-quarter 2022 results. The Zacks Consensus Estimate for quarterly revenues is pegged at $3.7 billion, which suggests a rise of 6.9% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for Kellogg’s quarterly earnings has been unchanged at 84 cents per share in the past 30 days. The consensus mark for K suggests 1.2% growth from the year-ago quarter’s reported number. K has delivered an earnings beat of 10.6%, on average, in the trailing four quarters.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.