Coca-Cola Outpaces Rivals with Strong Q4 Earnings

Coca-Cola (NYSE: KO) reported an impressive Q4, surpassing market expectations and gaining market share on competitor PepsiCo (NYSE: PEP).

Financial Highlights:

* Revenue: $11.5 billion (vs. $10.67 billion estimate)
* Adjusted EPS: $0.55 (vs. $0.52 estimate)
* Price/Mix Growth: 9%
* Unit Case Volume Growth: 2%

Key Factors:

* Higher prices and favorable product mix contributed to revenue growth.
* Unit case volumes increased in key markets, including Latin America and North America.
* Global reach and local expertise enabled the company to withstand external challenges.

Future Outlook:

* Organic revenue growth target of 5-6% in 2025.
* Adjusted earnings growth target of 2-3% in 2025.
* Focus on maintaining a balance between volume growth and pricing.

Industry Comparison:

* Coca-Cola shares have climbed 7% in the past year, outperforming PepsiCo's 16% decline.
* Coca-Cola's organic revenue growth in 2023 surpassed industry peers.

Regional Performance:

* Latin America net revenue increased 3% in Q4, driven by strong price/mix and unit case volume growth.
* North America unit case volume rose 1%, fueled by growth in sparkling flavors, juice, and plant-based beverages.

Potential Headwinds:

* Tariffs and inflation on agricultural commodities, including orange juice prices.
* CFO John Murphy expects a more normalized pricing environment in 2025.

Partnerships and Expansion:

* Coca-Cola contributed to McDonald's successful $5 meal bundle.
* Costco will be transitioning its food court fountain business back to Coca-Cola from PepsiCo.