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Coca-Cola (KO) Stock Moves 0.6%: What You Should Know

Zacks Equity Research

Coca-Cola (KO) closed at $55.35 in the latest trading session, marking a +0.6% move from the prior day. This change outpaced the S&P 500's 0% on the day. At the same time, the Dow added 0.08%, and the tech-heavy Nasdaq lost 0.18%.

Coming into today, shares of the world's largest beverage maker had gained 1.98% in the past month. In that same time, the Consumer Staples sector gained 3.21%, while the S&P 500 gained 3.37%.

Wall Street will be looking for positivity from KO as it approaches its next earnings report date. On that day, KO is projected to report earnings of $0.43 per share, which would represent no growth from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $8.86 billion, up 25.47% from the year-ago period.

KO's full-year Zacks Consensus Estimates are calling for earnings of $2.10 per share and revenue of $36.78 billion. These results would represent year-over-year changes of +0.96% and +15.46%, 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.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. KO is holding a Zacks Rank of #3 (Hold) right now.

Looking at its valuation, KO is holding a Forward P/E ratio of 26.19. Its industry sports an average Forward P/E of 23.19, so we one might conclude that KO is trading at a premium comparatively.

Meanwhile, KO's PEG ratio is currently 4. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Beverages - Soft drinks was holding an average PEG ratio of 2.2 at yesterday's closing price.

The Beverages - Soft drinks industry is part of the Consumer Staples sector. This industry currently has a Zacks Industry Rank of 151, which puts it in the bottom 41% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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