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On Tuesday, Citi analyst Filippo Falorni maintained a Buy rating and an $85.00 price target for Coca-Cola (NYSE:KO) stock. According to InvestingPro data, this target represents a potential 32% upside from the current price of $64.55, while the stock maintains an impressive gross profit margin of 60.4%. Falorni’s assessment followed Coca-Cola’s announcement of robust fourth-quarter results for 2024 and the release of its 2025 earnings guidance. Coca-Cola’s reported organic sales growth (OSG) of 14% exceeded the consensus forecast of 7.0%, buoyed by pricing that surpassed expectations at 9% compared to the anticipated 5.9%. Concentrate sales also outperformed, with a 5% increase against a forecasted 1.0%. InvestingPro analysis reveals that Coca-Cola’s strong performance is supported by its position as a prominent player in the beverages industry, with over 50 years of consecutive dividend payments and a current dividend yield of 3.01%.
Coca-Cola’s positive momentum continued with unit case volumes growing by 2%, which was higher than the consensus estimate of 0.6%. This growth marked a return to positive volume expansion. The earnings per share (EPS) for the quarter were $0.55, beating the consensus estimate of $0.52. According to Falorni, the company’s gross margin was above expectations, while operating margin aligned with forecasts.
Looking ahead, Coca-Cola has introduced its 2025 guidance, which includes an OSG of 5-6% and EPS growth of 2-3%. This guidance suggests an EPS range of $2.94 to $2.97, closely aligning with the consensus estimate of $2.95. Excluding foreign exchange impacts, the company anticipates EPS growth of 8-10%.
Falorni anticipates a positive market response to these results and believes that the fourth quarter performance validates his thesis that Coca-Cola will continue to see above-peer OSG growth. He notes that Coca-Cola’s strong pricing power and volume growth contribute to an attractive valuation, underpinned by what he views as best-in-class fundamentals. InvestingPro subscribers can access detailed financial health metrics, showing Coca-Cola maintains a "GOOD" overall financial health score, along with 8 additional exclusive ProTips and comprehensive valuation analysis in the Pro Research Report.
In other recent news, Coca-Cola has been making headlines with its robust financial performance and promising projections. Jefferies maintained a Buy rating on Coca-Cola with a price target of $75, highlighting the company’s strong finish to the year, surpassing organic sales expectations by 7 percentage points and earnings per share by 3 cents. The firm also noted Coca-Cola’s positive projections for 2025, reflecting its strong market position.
Similarly, RBC Capital Markets sustained their Outperform rating for Coca-Cola, anticipating a strong fourth quarter of 2024. The firm acknowledged potential foreign exchange headwinds but remained confident in the company’s ability to navigate market volatility.
However, Piper Sandler revised its outlook on Coca-Cola, reducing the price target from $74 to $73 due to anticipated currency headwinds in 2025. Despite this, the firm maintained an Overweight rating, expressing optimism about Coca-Cola’s fundamental business strength.
Furthermore, Piper Sandler started coverage on Coca-Cola with an Overweight rating and a price target of $74, citing the company’s strong brand presence and significant growth potential in emerging markets. These recent developments demonstrate Coca-Cola’s resilience and potential for continued growth, as well as its strong standing among investment firms.
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