While Coca-Cola (NYSE: KO) has been putting up solid organic revenue growth the past few years, its stock has largely been range bound. In fact, its stock price is up only about 15% over the past five years, as of this writing. However, the stock got a bit of a boost following its fourth-quarter earnings report and is now up around 10% year to date.
Let’s take a close look at the company’s Q4 results and guidance to see if the stock may finally break out of its trading range.
Pricing power was once again behind Coca-Cola’s solid results, with some modest case volume growth thrown in. For the quarter, the company’s organic revenue — which excludes the impact of acquisitions, divestitures, and currency movements — jumped 14%.
Its revenue was driven by a 9% jump in price and customers buying a more expensive product mix, with approximately 4% of the increase coming from markets experiencing intense price inflation. Meanwhile, unit case volumes rose by 2%, led by gains in the U.S., China, and Brazil. Coca-Cola Zero Sugar was a standout, with unit volumes growing 13% in the quarter. Overall concentrate sales rose by 5%
Geographically, prices/mix in North America climbed by 11%, with unit volumes up 1%. The company called out its namesake Coca-Cola brand, protein shake, and ultra-filtered milk brand Fairlife, and limited time offerings such as Sprite winter spiced cranberry for the solid performance.
Prices/mix in EMEA (Europe, Middle East, and Africa) rose by 11%, with unit volumes flat. Latin America saw price/mix soar 23%, but more than half of that was due to the impact of inflationary pricing in Argentina. Unit case volumes in the region rose 2%. Asia Pacific saw price/mix decline 5% due to an unfavorable product mix (meaning customers were being more price-conscious and, hence, bought the cheaper products from among Coca Cola’s offerings). However, unit volumes still jumped 6%.
Overall revenue in Q4 rose 6% to $11.54 billion, which easily topped the $10.68 billion consensus compiled by LSEG (formerly Refinitiv). Adjusted earnings per share (EPS) climbed 12% to $0.55, topping the $0.52 consensus.
|
Region |
Price/Mix Growth |
Case Volume Growth |
Concentrate Sales Growth |
Organic Revenue Growth |
Revenue Growth |
|---|---|---|---|---|---|
|
North America |
11% |
1% |
4% |
15% |
16% |
|
EMEA |
11% |
0% |
6% |
17% |
6% |
|
Latin America |
23% |
2% |
3% |
25% |
10% |
|
Asia Pacific |
-5% |
6% |
8% |
1% |
9% |
|
Overall |
9% |
2% |
5% |
14% |
6% |
Source: Company filings and press releases.
Coca-Cola said that it saw market-share gains across its beverage portfolio in 2024. It called out strong gains in sparkling soft drinks, value-added dairy (Fairlife), and tea.
