Coca-Cola Company (NYSE: KO) has announced that it will release Q3 2021 earnings results on October 27, 2021, before the market open.
What to look for
The company's earnings results in recent quarters have benefited from enhanced price/mix, the higher unit case volume, and an increase in concentrate sales that are expected to impact Q3 2021 results. Trademark Coca-Cola product categories volume gains will reflect in Q3 results showing gains from recovery across markets as the pandemic-led uncertainties subside. In addition, the company has increased investments to expand in the digital space leading to an e-commerce splurge with the channel's growth rate doubling in most countries, which will boost Q3 2021 sales.
Earnings: Stockeaning’s Estimated EPS for Q3 2021 is $0.58 suggesting a 5.5% YoY growth. Historical EPS Performance shows that the company has topped estimates in ten (83%) out of the past 12 quarters. In Q2 2021, the company delivered an EPS surprise of 19.3%, reporting EPS of $0.68 compared to the expected EPS of $0.56. In addition, the company has raised its EPS guidance for the full year and now expected adjusted EPS to grow between 13% and 15%, up from the previous range of high single digits to low double digits.
Revenue: The company expects to post revenue of $9.6 billion in Q3 2021, suggesting a 10.9% YoY growth. In Q2, the company topped estimates and posted revenue of $10.13 billion with a net income of $2.64 billion or $0.61 per share. In addition, the company predicted that it expects organic revenue growth of between 12% and 14% for the full year, up from the previous high single-digit growth forecast.
Stock movement: Coca-Cola's share price has been DOWN 2.1% since the last earnings release. Over the past 47 quarters, Coca-Cola shares have UP on 25 occasions. So, the historical price reaction suggests a 53% probability of the stock going UP after the Q3 earnings release. According to the Stockearning algorithm, the predicted first-day move is 2%, while the predicted activity on the seventh day is 2%.
What analysts are saying
Deutsche Bank analyst Steve Powers has lowered his target price on Coca-Cola shares from $60 to $59, but he maintained a "Hold" rating on the stock ahead of Q3 earnings results. The analyst is skewing cautiously on revenue compared to consensus estimates, but he is more bullish on Coca-Cola's earnings. Powers thinks "more volatile" away from home, and on-premise trends following the uptick of the Delta variants of COVID-19 and shipment timing concerns are more likely to impact channel mix and concentrate volumes.
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