Stockchase Opinions

Stockchase Discover Coca-Cola Consolidated, Inc. (Bottling) COKE-Q BUY Oct 18, 2022

Allan Tong’s Discover Picks Any discussion of Pepsi inevitably invites comparisons to Coke and not just about taste. Both soft drink producers have beaten their last four quarters with Coke most recently in late July coming in at $0.70, just beating the street’s $0.67. Revenues of $11.30 billion beat the expected $10.57 billion. COKE stock reports on Oct. 25 and the market is clearly bullish at 11 buys and three holds while targeting 20% higher to $66 a share. Read 3 Fast Food Stocks to Nibble On for our full analysis.
$445.340

Stock price when the opinion was issued

food processing
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DON'T BUY
Bottling company and he probably would not look at the bottling operation as he can’t see a lot of growth. US based only. He would prefer to play Coca-Cola (KO-N) and Pepsi (PEP-N) through their international operations.
BUY

The chart might be finding support at around $37. Looks like head and shoulders formation, but he doesn't assign those formations to such a large company. But he thinks that at $37 it is a safe buy.

DON'T BUY

Do I want to bet against Warren Buffet? Sugar and fizzy water? Will it sell to Millennials? An unbelievable track record of making money for 100 years. He prefers Doctor Pepper. 70% of profits of COKE-Q are from outside of the US and the high dollar de-values their profits. Doctor pepper is more domestic.

BUY

They are trying to refranchise some of their bottling agreements and are 2/3rds of the way through. They should increase their margins.

BUY

It hasn't done much lately. Pepsi reported a good quarter and gained a bit of market share from other peers. COKE reports Monday and he expects good numbers along with food service reopenings, but doesn't know if it will do as well as Pepsi

COMMENT

PEP-Q vs. COKE-Q. He would be more inclined to take Pepsi as they diversified better and the growth has been better over the last few years.

BUY
They report tomorrow. They face currency risks, but that's offset by new alcohol products that could move the needle. Also, Coke is better run than, say, Walmart.
BUY ON WEAKNESS

It's gone straight up way too fast. Trades at 22x PE and is a good company, so wait for a pullback.

BUY

It reports tomorrow. He expects 7% organic revenue growth because of stabilization in the business and a healthy pricing mix.