The quarterly results published yesterday show why the Coke (KO;COCA34) occupies the Olympus of megacorporations. Between yesterday and today, the company’s shares are up 1.6%.
The secular company reported a 10% increase in revenue to $11.05 billion in the quarter, due to higher prices across the company’s portfolio. The figure already excludes currency effects which have turned a stone in the shoe of more than 33% of companies listed on the S&P 500.
Sales volumes increased by 4%, with renewed emphasis on Coke Zero Sugar, which saw an 11% increase in releases. The company’s Hydration, Sports, Coffee and Tea division reported volume growth of 5%, driven by Powerade, Bodyarmor and the expansion of Costa Coffee.
Coca-Cola’s nutrition, juice, dairy and plant-based beverages division saw flat volume for the quarter, which the company attributed to lower demand for local brands in Eastern Europe.
Coca-Cola Guidance for 2022 impresses
As Avenue chief strategist William Castro Alves points out, as important as the outcome was that the company raised its guidance for the year. In other words, the company is more optimistic for the next quarter of 2022, despite the headwinds of recession that should ring stronger towards the end of the year.
For 2022, Coca-Cola said it expects earnings per share growth of between 6% and 7%, above the range above its previous range of 5% to 6%. “The company also raised its organic revenue growth outlook to 14% to 15%, from a range of 12% to 13%,” he said.
For the year ahead, however, the company stressed that it expects inflation to continue to drive up spending, commodity prices to remain volatile and the strength of the dollar to scale. world will also end up negatively affecting its profits and Coca-Cola’s revenues.
KO (Nasdaq symbol of Coca-Cola) has a market capitalization of approximately $250 billion, a P/E (price/earnings) of 26.17%. Over the year, the company’s shares fell 2%, showing impressive resilience in the face of the downward pressures that define the trajectory of markets in 2022.
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