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On Tuesday, UBS analyst Peter Grom reaffirmed a Buy rating for Coca-Cola stock (NYSE:KO) with a steady price target of $73.00. The stock, currently trading near its 52-week high of $73.95, has demonstrated impressive momentum with a 17.74% year-to-date return. According to InvestingPro data, analyst price targets for KO range from $59.60 to $85.00, with a consensus recommendation leaning strongly toward Buy. Grom’s analysis anticipates Coca-Cola’s first-quarter earnings report, which is scheduled for release next Tuesday, April 29, before the market opens. UBS forecasts a Q1 earnings per share (EPS) of $0.71 for the beverage company, slightly below the consensus of Visible Alpha and Factset by one cent. The company maintains impressive gross profit margins of 61.06% and has shown consistent profitability over the last twelve months. InvestingPro subscribers can access 10+ additional key metrics and insights about Coca-Cola’s upcoming earnings.
The UBS analyst pointed out that investors are monitoring demand trends closely, noting a slight deceleration in growth in the US and Europe. Additionally, there has been some unevenness in key international markets according to peer commentary. Despite these factors, the sentiment towards Coca-Cola remains generally positive. The expectation is that, even with potential marginal slowdowns in demand due to macroeconomic shifts, Coca-Cola is still on track to outperform in organic revenue growth for both the quarter and the calendar year 2025.
Grom highlighted the confidence in Coca-Cola’s ability to meet bottom-line expectations, bolstered by favorable currency movements. Coca-Cola has been the top performer within UBS’s large-cap multinational coverage year-to-date, showing a 17% increase compared to the 4% gain of the Consumer Staples Select Sector SPDR Fund (XLP).
The analyst’s commentary suggests that while Coca-Cola’s stock might be a popular choice among investors as earnings approach, its consistent delivery of solid top and bottom-line results justifies a higher premium relative to its peers. The company’s strong financial health score and 54-year history of consecutive dividend increases further support its premium valuation. Discover more detailed analysis and valuation metrics in the comprehensive Pro Research Report, available exclusively on InvestingPro.
In other recent news, Coca-Cola’s earnings and revenue projections have garnered significant attention, with several analyst firms providing updates on the company’s stock. CFRA analyst Garrett Nelson upgraded Coca-Cola stock to a Strong Buy, raising the price target to $80 due to favorable currency fluctuations and strong U.S. revenue growth. TD Cowen maintained a Buy rating with a $78 target, highlighting Coca-Cola’s effective management and marketing strategies despite a slight reduction in volume growth expectations. Piper Sandler also increased its price target to $80, citing Coca-Cola’s robust near-term momentum and strategic market positioning.
Additionally, Erste Group upgraded Coca-Cola stock from Hold to Buy, emphasizing the company’s superior operating margin and return on equity. They projected organic sales growth of 5-6% year-over-year, driven by new product introductions like probiotic lemonades. The recent proposal to ban soda purchases with food stamps has raised concerns about potential impacts on Coca-Cola’s sales. This initiative, gaining traction among lawmakers, could affect revenue streams for beverage companies if enacted. Investors are closely monitoring these developments and the company’s ability to navigate regulatory challenges and capitalize on growth opportunities.
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