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Coca-Cola (KO) Increases Despite Market Slip: Here's What You Need to Know

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Coca-Cola (KO - Free Report) closed the latest trading day at $73.01, indicating a +0.75% change from the previous session's end. This change outpaced the S&P 500's 2.12% loss on the day. On the other hand, the Dow registered a loss of 1.51%, and the technology-centric Nasdaq decreased by 3.26%.

Shares of the world's largest beverage maker witnessed a gain of 6.42% over the previous month, beating the performance of the Consumer Staples sector with its gain of 2.03% and the S&P 500's gain of 5.78%.

The investment community will be paying close attention to the earnings performance of Coca-Cola in its upcoming release. The company's earnings per share (EPS) are projected to be $0.75, reflecting a 1.35% increase from the same quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $11.65 billion, showing a 2.56% drop compared to the year-ago quarter.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $2.85 per share and revenue of $46.03 billion. These totals would mark changes of +5.95% and +0.61%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for Coca-Cola. These revisions typically reflect the latest short-term business trends, which can change frequently. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

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 last 30 days, the Zacks Consensus EPS estimate has moved 0.04% higher. Coca-Cola is currently sporting a Zacks Rank of #3 (Hold).

In the context of valuation, Coca-Cola is at present trading with a Forward P/E ratio of 25.44. This indicates a premium in contrast to its industry's Forward P/E of 19.62.

It's also important to note that KO currently trades at a PEG ratio of 4.01. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. By the end of yesterday's trading, the Beverages - Soft drinks industry had an average PEG ratio of 2.87.

The Beverages - Soft drinks industry is part of the Consumer Staples sector. This industry currently has a Zacks Industry Rank of 219, which puts it in the bottom 14% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.


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