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Factors Likely to Influence Coca-Cola (KO) in Q2 Earnings
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The Coca-Cola Company (KO - Free Report) is expected to register top-line growth when it reports second-quarter 2022 numbers on Jul 26, before the opening bell. The Zacks Consensus Estimate for the company’s second-quarter revenues is pegged at $10.8 billion, suggesting 5.9% growth from the prior-year quarter’s reported figure.
For second-quarter earnings, the consensus mark is pegged at 67 cents, suggesting a decline of 1.5% from the year-ago quarter’s reported figure. The consensus mark has moved down by a penny in the past 30 days.
In the last reported quarter, the leading soft-drink behemoth delivered an earnings surprise of 10.3%. Its bottom line beat the Zacks Consensus Estimate by 13.6%, 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 volumes are expected to have been driven by strength across the majority of markets, investments in the marketplace, recovery in certain markets, and the cycling of last year’s pandemic-led impacts. Revenues are also expected to have gained from improved price/mix, driven by pricing actions in the marketplace, coupled with a favorable channel and package mix due to the lapping of last year’s pandemic-led disruptions.
Continued volume gains in the trademark Coca-Cola; sparkling flavors; the nutrition, juice, dairy and plant-based beverages; and hydration, sports, coffee and tea categories are expected to get reflected in the company’s second-quarter results.
Coca-Cola’s second-quarter results are likely to reflect ongoing 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 further piloting various digital-enabled initiatives through fulfillment methods to capture the online demand, which are likely to have boosted second-quarter sales.
However, Coca-Cola has been witnessing pressures from higher supply-chain costs, including higher commodity input costs and transportation expenses. It has also been seeing pressures related to commodity and material cost inflation. The pressures from input cost inflation and other costs are likely to have hurt the performance in the second 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 second quarter.
On the last reported quarter’s earnings call, the company expected adverse currency rates to hurt the top and bottom lines in the second quarter. The company expects a currency headwind of 4% on revenues and comparable earnings per share for the second quarter.
Zacks Model
Our proven model does not conclusively predict 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 #3 and an Earnings ESP of -0.71%.
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:
Lamb Weston (LW - Free Report) has an Earnings ESP of +0.99% and it currently sports a Zacks Rank of 1. The company is likely to register top and bottom-line growth when it reports fourth-quarter fiscal 2022 earnings. The consensus mark for LW’s quarterly revenues is pegged at $1.07 billion, which suggests 6.03% growth from the figure reported in the prior-year quarter.
The consensus mark for Lamb Weston’s quarterly earnings has moved up by a penny in the past 30 days to 51 cents per share. The consensus estimate for LW’s fiscal fourth-quarter earnings suggests growth of 15.9% from the year-ago quarter’s reported figure.
Archer Daniels Midland (ADM - Free Report) currently has an Earnings ESP of +1.56% and a Zacks Rank of 3. The company is likely to register an increase in the top and bottom lines when it reports second-quarter 2022 numbers. The consensus mark for ADM’s quarterly earnings has moved up 3.6% in the past 30 days to $1.75 per share. The consensus estimate suggests growth of 31.6% from the year-ago quarter’s reported number.
Archer Daniels’ top line is expected to rise year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $25.3 billion, which suggests a rise of 10.2% from the figure reported in the prior-year quarter.
Chipotle Mexican Grill (CMG - Free Report) currently has an Earnings ESP of +0.51% and a Zacks Rank of 3. The company is likely to register an increase in the top and bottom lines when it reports second-quarter 2022 results. The consensus mark for CMG’s quarterly revenues is pegged at $2.24 billion, which suggests a rise of 18.5% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for Chipotle’s second-quarter earnings has moved down by 0.2% to $9.02 per share in the past 30 days. The consensus estimate for CMG indicates 20.9% growth from $7.46 reported in the year-ago quarter.
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Factors Likely to Influence Coca-Cola (KO) in Q2 Earnings
The Coca-Cola Company (KO - Free Report) is expected to register top-line growth when it reports second-quarter 2022 numbers on Jul 26, before the opening bell. The Zacks Consensus Estimate for the company’s second-quarter revenues is pegged at $10.8 billion, suggesting 5.9% growth from the prior-year quarter’s reported figure.
For second-quarter earnings, the consensus mark is pegged at 67 cents, suggesting a decline of 1.5% from the year-ago quarter’s reported figure. The consensus mark has moved down by a penny in the past 30 days.
In the last reported quarter, the leading soft-drink behemoth delivered an earnings surprise of 10.3%. Its bottom line beat the Zacks Consensus Estimate by 13.6%, 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 volumes are expected to have been driven by strength across the majority of markets, investments in the marketplace, recovery in certain markets, and the cycling of last year’s pandemic-led impacts. Revenues are also expected to have gained from improved price/mix, driven by pricing actions in the marketplace, coupled with a favorable channel and package mix due to the lapping of last year’s pandemic-led disruptions.
Continued volume gains in the trademark Coca-Cola; sparkling flavors; the nutrition, juice, dairy and plant-based beverages; and hydration, sports, coffee and tea categories are expected to get reflected in the company’s second-quarter results.
Coca-Cola’s second-quarter results are likely to reflect ongoing 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 further piloting various digital-enabled initiatives through fulfillment methods to capture the online demand, which are likely to have boosted second-quarter sales.
However, Coca-Cola has been witnessing pressures from higher supply-chain costs, including higher commodity input costs and transportation expenses. It has also been seeing pressures related to commodity and material cost inflation. The pressures from input cost inflation and other costs are likely to have hurt the performance in the second 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 second quarter.
On the last reported quarter’s earnings call, the company expected adverse currency rates to hurt the top and bottom lines in the second quarter. The company expects a currency headwind of 4% on revenues and comparable earnings per share for the second quarter.
Zacks Model
Our proven model does not conclusively predict 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 #3 and an Earnings ESP of -0.71%.
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:
Lamb Weston (LW - Free Report) has an Earnings ESP of +0.99% and it currently sports a Zacks Rank of 1. The company is likely to register top and bottom-line growth when it reports fourth-quarter fiscal 2022 earnings. The consensus mark for LW’s quarterly revenues is pegged at $1.07 billion, which suggests 6.03% growth from the figure reported in the prior-year quarter.
The consensus mark for Lamb Weston’s quarterly earnings has moved up by a penny in the past 30 days to 51 cents per share. The consensus estimate for LW’s fiscal fourth-quarter earnings suggests growth of 15.9% from the year-ago quarter’s reported figure.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Archer Daniels Midland (ADM - Free Report) currently has an Earnings ESP of +1.56% and a Zacks Rank of 3. The company is likely to register an increase in the top and bottom lines when it reports second-quarter 2022 numbers. The consensus mark for ADM’s quarterly earnings has moved up 3.6% in the past 30 days to $1.75 per share. The consensus estimate suggests growth of 31.6% from the year-ago quarter’s reported number.
Archer Daniels’ top line is expected to rise year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $25.3 billion, which suggests a rise of 10.2% from the figure reported in the prior-year quarter.
Chipotle Mexican Grill (CMG - Free Report) currently has an Earnings ESP of +0.51% and a Zacks Rank of 3. The company is likely to register an increase in the top and bottom lines when it reports second-quarter 2022 results. The consensus mark for CMG’s quarterly revenues is pegged at $2.24 billion, which suggests a rise of 18.5% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for Chipotle’s second-quarter earnings has moved down by 0.2% to $9.02 per share in the past 30 days. The consensus estimate for CMG indicates 20.9% growth from $7.46 reported in the year-ago quarter.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.