The consumer staples industry, which served as a sanctuary from four-decade inflation and market turmoil in 2023, faced a dramatic shift this year as investors fled amid easing macroeconomic risks.
Q3 2023 report
The reignited investor optimism around Coke’s shares was caused by the company’s better-than-expected earnings and revenue in Q3, as well as a hike in the full-year guidance.
Coca-Cola reported adjusted earnings per share (EPS) of 74 cents in the third quarter, exceeding the consensus estimates of 69 cents. Net income attributable to shareholders stood at $3.09 billion in the period, or 71 cents per share, compared to $2.83 billion, or 65 cents, in the year-ago quarter.
Coke generated $11.91 billion in adjusted revenue, beating the consensus projection of $11.44 billion. Net sales increased by 8% to $11.91 billion, excluding items, while organic revenue, which excludes the impact of acquisitions and divestitures, grew 11% year-over-year (YoY).
The company’s unit case volume, which does not include pricing and currency, rose 2% in the quarter in spite of higher prices.
Outlook for full 2023
Looking ahead to the full fiscal 2023, Coca-Cola said it expects comparable EPS to grow between 7% and 8%, up from the previous forecast range of 5% to 6%. Coke also raised its outlook for organic revenue to 10-11%, compared with the previous growth outlook of 8-9%.
For 2024, the Atlanta, Georgia-based beverage giant anticipates a mid-single-digit blow from currency, adding that the rest of the 2024 outlook will be shared when it reports Q4 earnings.
KO technical analysis
With the recent gains, KO crossed above an important resistance at $54, which now acts as support. On the upside, the stock currently faces another barrier at around $56.7.
However, the company’s shares remain significantly below their 100-day and 200-day moving averages (MAs), located at $59.13 and $60.28, respectively.
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