Coca-Cola (NYSE:KO) Sets New 1-Year High - Still a Buy?

Key Points

• Coca-Cola hit a 52-week high of about $97.50. Analysts rate the stock a “Moderate Buy,” with an average price target of $97.26, while some coverage warns its rally may have left limited upside at its current valuation.
• Quarterly results beat expectations: Coca-Cola reported earnings of $0.91 per share and revenue of $13.35 billion, up 7.2% year over year.
• The company announced a quarterly dividend of $0.53 per share, equivalent to an annualized yield of about 2.2%; commentary also cited global volume growth, expanding margins, and strong free cash flow as supports for the payout.

Coca-Cola Company (The) (NYSE:KO - Get Free Report) shares reached a new 52-week high during trading on Wednesday. The company traded as high as $97.49 and last traded at $97.4950, with a volume of 7,591,631 shares changing hands. The stock had previously closed at $96.91.

Key Headlines Impacting Coca-Cola

Here are a few of the latest headlines about KO:

• Positive Sentiment: Commentary points to strong global volume growth, expanding margins and robust free cash flow supporting Coca-Cola’s dividend. The company’s latest reported quarter also beat earnings and revenue estimates, providing a favorable fundamental backdrop. Kraft Heinz Yields 6.6% and Coca-Cola Yields 2.3%
• Neutral Sentiment: Coca-Cola said CFO John Murphy will present at the Morgan Stanley Global Consumer & Retail Conference on Dec. 2. The announcement may provide an opportunity for business updates but contains no new financial guidance. Coca-Cola Announces Conference Participation
• Negative Sentiment: Some coverage cautions that KO is not cheap after its recent rally, potentially limiting upside if earnings growth does not keep pace with the share price. Coca-Cola Is Up 5% Since Reporting Earnings

Analysts Set New Price Targets

A number of research firms have commented on KO. JPMorgan Chase & Co. lifted their target price on Coca-Cola from $95.00 to $98.00 and gave the company an "overweight" rating in a research report on Wednesday, October 28th. Citigroup increased their price target on Coca-Cola from $102.00 to $103.00 and gave the stock a "buy" rating in a report on Wednesday, October 28th. Morgan Stanley increased their price target on Coca-Cola from $100.00 to $103.00 and gave the stock an "overweight" rating in a report on Wednesday, October 28th. Rothschild & Co Redburn raised their price objective on Coca-Cola from $86.00 to $92.00 and gave the stock a "buy" rating in a research report on Wednesday, July 29th. Finally, Wells Fargo & Company boosted their price objective on shares of Coca-Cola from $90.00 to $100.00 and gave the company an "overweight" rating in a report on Wednesday, October 28th. One investment analyst has rated the stock with a Strong Buy rating, twenty have given a Buy rating and three have assigned a Hold rating to the company. Based on data from MarketBeat.com, the stock currently has an average rating of "Moderate Buy" and an average price target of $97.26.

Coca-Cola Trading Up 0.8%

The company has a market cap of $420.22 billion, a PE ratio of 28.72, a price-to-earnings-growth ratio of 3.75 and a beta of 0.28. The company has a quick ratio of 1.19, a current ratio of 1.38 and a debt-to-equity ratio of 0.93. The business has a 50-day simple moving average of $90.25 and a 200-day simple moving average of $82.93.

Coca-Cola (NYSE:KO - Get Free Report) last released its quarterly earnings results on Tuesday, October 27th. The company reported $0.91 EPS for the quarter, topping the consensus estimate of $0.88 by $0.03. Coca-Cola had a return on equity of 38.79% and a net margin of 28.65%. The business had revenue of $13.35 billion during the quarter, compared to analyst estimates of $12.92 billion. During the same period last year, the business posted $0.82 earnings per share. The company's quarterly revenue was up 7.2% on a year-over-year basis. On average, analysts predict that Coca-Cola Company will post 3.34 EPS for the current fiscal year.

Coca-Cola Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Tuesday, December 15th. Investors of record on Tuesday, December 1st will be paid a dividend of $0.53 per share. This represents a $2.12 annualized dividend and a yield of 2.2%. The ex-dividend date of this dividend is Tuesday, December 1st. Coca-Cola's dividend payout ratio is presently 62.35%.

Insider Buying and Selling at Coca-Cola

In other news, insider Bruno Pietracci sold 111,365 shares of the company's stock in a transaction on Thursday, August 20th. The stock was sold at an average price of $90.93, for a total transaction of $10,126,419.45. Following the sale, the insider owned 41,365 shares of the company's stock, valued at approximately $3,761,319.45. This represents a 72.92% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, EVP Beatriz R. Perez sold 67,548 shares of the stock in a transaction on Monday, November 2nd. The shares were sold at an average price of $94.91, for a total value of $6,410,980.68. Following the completion of the sale, the executive vice president owned 160,428 shares in the company, valued at approximately $15,226,221.48. The trade was a 29.63% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders sold 249,498 shares of company stock valued at $23,025,238 in the last 90 days. Company insiders own 0.90% of the company's stock.

Institutional Investors Weigh In On Coca-Cola

Several large investors have recently bought and sold shares of the stock. Bank of America Corp DE increased its stake in shares of Coca-Cola by 4.4% during the second quarter. Bank of America Corp DE now owns 45,958,636 shares of the company's stock worth $3,735,058,000 after buying an additional 1,939,673 shares during the period. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC grew its holdings in Coca-Cola by 0.4% during the 2nd quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 36,354,414 shares of the company's stock worth $2,954,523,000 after acquiring an additional 162,097 shares in the last quarter. Wellington Management Group LLP grew its holdings in Coca-Cola by 9.2% during the 2nd quarter. Wellington Management Group LLP now owns 29,053,752 shares of the company's stock worth $2,361,198,000 after acquiring an additional 2,439,026 shares in the last quarter. Dimensional Fund Advisors LP grew its holdings in Coca-Cola by 1.3% during the 1st quarter. Dimensional Fund Advisors LP now owns 18,822,295 shares of the company's stock worth $1,431,495,000 after acquiring an additional 235,785 shares in the last quarter. Finally, Fayez Sarofim & Co increased its position in shares of Coca-Cola by 0.7% in the 2nd quarter. Fayez Sarofim & Co now owns 15,272,831 shares of the company's stock valued at $1,241,223,000 after purchasing an additional 113,599 shares during the last quarter. Hedge funds and other institutional investors own 70.26% of the company's stock.

Coca-Cola Company Profile

The Coca-Cola Company NYSE: KO is a global beverage company headquartered in Atlanta, Georgia. Founded in 1886, it is best known for Coca-Cola, one of the world’s most recognized soft drink brands. The company owns, licenses, and markets a broad portfolio of beverages, including sparkling soft drinks, water, sports drinks, coffee, tea, juice, dairy and plant-based beverages, and energy drinks. Its brands include Coca-Cola, Diet Coke, Coca-Cola Zero Sugar, Sprite, Fanta, Dasani, smartwater, Powerade, Minute Maid, Simply, fairlife, and Costa Coffee, among others.

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