Coca-Cola (KO) dipped in pre-market trading even as the company reported strong Q3 results. The soft drinks giant’s adjusted earnings increased by 5% year-over-year to $0.77 per share, above analysts’ expectations of $0.75 per share.
Furthermore, the company’s net revenues declined by 1% year-over-year to $11.9 billion, and surpassed consensus estimates of $11.6 billion.
KO’s Average Selling Price Increased, but Volumes Remained Flat
Additionally, in the third quarter, Coca-Cola’s average selling prices increased by 10%, while overall unit case volumes remained flat globally. North America saw stable volumes, as declining demand for water, sports drinks, and coffee was balanced by volume growth in sodas, juice, and plant-based beverages. However, in regions like Europe, the Middle East, Africa, and Asia Pacific, volumes dropped by 2%, with notable declines in China and Turkey.
KO Issues FY24 Outlook
Looking ahead, the company expects organic revenues in FY24 to grow by 10% year-over-year, compared to its prior forecast of a rise of 9% to 10%, while adjusted earnings are estimated to grow in the range of 5% to 6%.
In the fourth quarter, KO expects its Q4 revenues and earnings to take a hit of 4% and 10%, respectively, due to currency exchange rate fluctuations.
What Is the Target Price for KO?
Analysts remain cautiously optimistic about KO stock, with a Moderate Buy consensus rating based on 12 Buys and six Holds. Over the past year, KO has increased by more than 30%, and the average KO price target of $74.12 implies an upside potential of 6.7% from current levels. These analyst ratings are likely to change following KO’s results today.
