Coca-Cola Beats Estimates, JPM Says Raised Forecast is Better Than Expected

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By Senad Karaahmetovic

Coca-Cola (NYSE:KO) reported better-than-expected Q3 earnings and raised its full-year forecast to send its shares over 3% higher in early Tuesday trading.

Coca-Cola reported an EPS of $0.69 on revenue of $11.1 billion to beat the consensus that was calling for an EPS of $0.64 on revenue of $10.53 billion. Coca-cola said its unit case volume increased 4% YoY.

On a full-year basis, Coca-Cola hiked the adjusted organic revenue for the full year to a range of +14% to +15% from +12% to +13%. The adjusted organic revenue is seen between +14% and +15%, beating the +13.4% consensus. Coca-Cola expects comparable EPS to increase between +6% and +7%.

Goldman Sachs analysts said KO delivered better-than-expected results despite the fact that the bar was high.

"Healthy underlying demand drove an impressive organic top and a bottom line beat. Further, given the strength in the quarter, KO raised its FY22 organic sales growth and EPS neutral FX guidance, and provided initial expectations for FY23 FX impact. We think KO's results today are good enough to satisfy investors given the challenging operating environment, though FX headwinds remain a concern moving forward," the analysts told clients.

JPMorgan analysts said results came in strong, in line with investors' expectations.

"While implied 4Q is below the Street, we think the slight '22 EPS lift was better than expected, and management is likely embedding some conservatism… Demand trends remain resilient and demonstrate the attractiveness of KO's brand equity and resilient categories in the face of macro uncertainty," the analysts wrote to clients in a note.