Aluminum Tariff Impacts on Coca-Cola: A Comprehensive Analysis

Despite the imposition of a 25% tariff on aluminum imports, Coca-Cola (KO) remains optimistic about its financial outlook. CFO John Murphy views the increased aluminum prices as "a relatively small amount" in the overall supply chain and anticipates minimal impact on consumer pricing.

The company is also exploring product innovation to drive revenue growth, including introducing new can sizes and formulations. This strategy aligns with the "revenue growth management equation" implemented over the past several years.

In the fourth quarter, Coca-Cola surpassed analyst estimates with revenue reaching $11.5 billion and earnings per share at $0.55. Price mix and unit case volume contributed to the strong performance.

For 2025, Coca-Cola projects organic revenue growth of 5% to 6% and adjusted earnings growth of 2% to 3%. Shares have risen over 4% since the earnings announcement.

However, currency fluctuations may impact earnings, with CFRA estimating a 6% to 7% negative impact due to the strengthening dollar and the company's international revenue exposure.