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Yahoo
21-05-2025
- Business
- Yahoo
KO vs. KDP: Which Beverage Player is More Refreshing for Investors?
The global beverage industry is undergoing transformation. At the center of this stands a compelling showdown between two very different giants: The Coca-Cola Company KO and Keurig Dr Pepper Inc. KDP. This industry, once dominated by legacy carbonated soft drinks, now spans a wide range of categories, including premium waters, ready-to-drink coffees, low- or no-sugar beverages, and functional drinks. KO and KDP each bring distinct strengths and strategies to the table as they compete for market share in this increasingly health-conscious and convenience-driven Coca-Cola, with more than 130 years of brand equity, commands unmatched global reach and a singular focus on beverages, KDP is a newer yet increasingly influential player that combines traditional soft drink power with a disruptive presence in the at-home coffee and beverage appliance segment. The contrast between these companies reflects the growing complexity of the beverage industry, where innovation, convenience, and health-conscious offerings are reshaping consumer face-off goes beyond classic soda wars; it is a battle of business models, innovation pipelines, strategic positioning, and shareholder returns. From financial performance and operational efficiency to product diversification and future growth potential, we will explore how these two players stack up in a rapidly changing you're betting on scale and legacy or disruption and agility, the competition between KO and KDP offers key insights for investors. So, let us dive into the numbers and the strategies to see which contender holds the stronger hand in today's beverage take a closer look. As one of the most recognized consumer brands in the world, Coca-Cola continues to dominate the global non-alcoholic beverage industry with an unmatched portfolio of more than 30 billion-dollar brands. With operations in more than 200 countries, Coca-Cola commands a significant value share across key beverage categories and channels, including both at-home and away-from-home consumption. Approximately 30% of its volume now comes from low- or no-calorie beverages, highlighting its alignment with evolving consumer health business strategy is built around an 'all-weather' approach, meaning it is designed to work well in both good and challenging times. Coca-Cola offers a wide range of products from classic sodas like Coca-Cola Zero Sugar and Sprite to dairy drinks like Fairlife, bottled waters like Dasani and Smartwater, and new health-focused options like Simply Pop, a prebiotic soda. The company adjusts its pricing and packaging to match what people can afford and works closely with its bottling partners to make sure products are available everywhere.A key pillar of Coca-Cola's growth is its investment in digital innovation and marketing personalization. Through platforms like Studio X, the company delivers localized, data-driven marketing content at scale. It also integrates connected packaging to deliver immersive consumer experiences, most notably through its 'Share a Coke' campaign, reintroduced in 2025 with a Gen Z-focused digital twist. Coca-Cola's digital ecosystem supports more than 100,000 customers in India alone, while its AI-powered tools are enhancing marketing efficiency and spend optimization. Keurig Dr Pepper has emerged as a powerful force in the beverage industry, successfully bridging the gap between established category leadership and disruptive innovation. With a diverse portfolio that spans carbonated soft drinks, premium coffee, energy beverages, and hydration products, KDP competes in virtually every key segment of the non-alcoholic beverage market. Brands like Dr Pepper, Canada Dry, and 7UP continue to gain market share, while newer offerings, such as Electrolit and Ghost, are expanding the company's reach into high-growth categories like sports hydration and company's strategic approach focuses on balancing short-term execution with long-term brand building. In its cold beverage portfolio, KDP has emphasized innovation, brand refreshes, and expanded distribution, all underpinned by full-funnel marketing and retail execution. In coffee, the company is reshaping its future growth through premium offerings like La Colombe and Lavazza, investing in next-generation systems, such as Keurig Alta, and exploring more sustainable brewing formats like a consumer and digital engagement perspective, KDP is highly attuned to emerging demographics and market trends. It is expanding its presence among consumers, introducing brands that resonate with younger and more health-conscious audiences, and scaling female-forward innovations like Bloom Sparkling Energy. Digital innovation is a growing pillar, with the company leveraging data-driven marketing and personalized content to boost brand relevance and conversion. This modern, insight-led approach, coupled with a portfolio that covers every major beverage occasion from morning coffee to evening refreshment, makes KDP a compelling investment. The Zacks Consensus Estimate for Coca-Cola's 2025 sales and EPS implies year-over-year growth of 2.4% and 2.9%, respectively. The EPS estimates have remained stable in the past 30 days. Image Source: Zacks Investment Research The Zacks Consensus Estimate for Keurig's 2025 sales and EPS suggests year-over-year growth of 5.6% and 6.1%, respectively. EPS estimates have moved up by a penny in the past 30 days. Image Source: Zacks Investment Research Coca-Cola currently trades at a forward 12-month P/E ratio of 23.45X, which is above the Zacks Beverages - Soft drinks industry average of 18.66X. In contrast, KDP trades at a lower multiple of 16.19X, making it the more value-oriented pick among the two. Image Source: Zacks Investment Research Coca-Cola's higher multiple is justified by its superior performance, global dominance, and consistent execution, which warrant a valuation KDP being the more value-oriented option based on valuation alone, investors pay up for KO because it consistently delivers stronger returns. Over the past year, Coca-Cola stock has gained 13.7%, outperforming KDP and the broader industry's decline of 1.2% and 4%, respectively. While KDP offers a lower valuation, Coca-Cola's stronger stock performance and solid growth trajectory give it the edge. Image Source: Zacks Investment Research Despite its growing influence, KDP still lacks the global scale and market penetration of Coca-Cola, which operates in more than 200 countries and owns many of the world's top-selling beverage brands. While KDP shows strong momentum in innovation, it still trails Coca-Cola in brand equity and global brand recognition. Coca-Cola's century-old legacy and deep emotional connection with consumers around the world give it a commanding edge in terms of loyalty, trust, and cross-border KDP is undoubtedly a rising contender with impressive agility, it remains in the shadow of Coca-Cola's unmatched global infrastructure, legacy, and portfolio for investors seeking stability, consistent brand-driven growth, and long-term value creation, Coca-Cola stands out as the stronger, more reliable choice. KO currently carries a Zacks Rank #2 (Buy), whereas KDP has a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report CocaCola Company (The) (KO) : Free Stock Analysis Report Keurig Dr Pepper, Inc (KDP) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
13-05-2025
- Business
- Yahoo
KO Q1 Earnings Call: Coca-Cola Delivers Flat Sales, Highlights Margin Gains and Local Strategies
Beverage company Coca-Cola (NYSE:KO) reported Q1 CY2025 results exceeding the market's revenue expectations , but sales were flat year on year at $11.22 billion. Its non-GAAP profit of $0.73 per share was 1.4% above analysts' consensus estimates. Is now the time to buy KO? Find out in our full research report (it's free). Revenue: $11.22 billion vs analyst estimates of $11.15 billion (flat year on year, 0.6% beat) Adjusted EPS: $0.73 vs analyst estimates of $0.72 (1.4% beat) Adjusted EBITDA: $4.05 billion vs analyst estimates of $4.06 billion (36.1% margin, in line) Operating Margin: 32.6%, up from 19.1% in the same quarter last year Free Cash Flow was -$5.51 billion, down from $158 million in the same quarter last year Organic Revenue rose 6% year on year (11% in the same quarter last year) Sales Volumes rose 2% year on year (1% in the same quarter last year) Market Capitalization: $299.3 billion Coca-Cola's first quarter results were shaped by region-specific demand shifts, ongoing margin expansion, and targeted investments in brand relevance. CEO James Quincey pointed to volume growth across global beverage categories, but acknowledged challenges in North America and Mexico, particularly among Hispanic consumers, where weaker sentiment and a misleading viral video weighed on flagship brand performance. The company emphasized agility in responding to market-specific headwinds, with bright spots in products like Coca-Cola Zero Sugar and Fairlife. Looking ahead, management reiterated its confidence in the company's strategy as it navigates uneven consumer trends and macroeconomic uncertainty. The outlook is supported by Coca-Cola's focus on affordability, local production, and continued innovation, including the return of the Share a Coke campaign and expansion in functional beverages. CFO John Murphy noted, "We are being prudent to not get flow through" on currency guidance and remain committed to long-term growth targets, while preparing for potentially choppy conditions in coming quarters. Coca-Cola's management attributed the quarter's results to a mix of geographic and product-specific dynamics, with particular attention to regional consumer sentiment and brand performance outside core markets. Deviation from consensus expectations came mainly from stronger-than-expected operating margin expansion, driven by cost management, and continued focus on local execution rather than headline growth rates. North America softness: The company cited weakening consumer sentiment, especially among Hispanic consumers, and the impact of a false viral video affecting Coca-Cola Original sales in Southern states. Management responded by increasing focus on affordability options and tailored promotions. Mexico volume pressures: Softer performance in Mexico was attributed to cycling strong growth in the prior year, calendar shifts, and macro uncertainty following local elections. The company launched the Hecho en Mexico campaign and emphasized value packaging to regain momentum. Asia-Pacific and India growth: Volume gains in Asia-Pacific were led by strong execution in India and a recovery in China, where marketing activations during Lunar New Year and portfolio rationalization helped drive demand. Fairlife's continued expansion: Fairlife remained the leading contributor to retail dollar growth in the beverage industry. Management expects growth to moderate as the brand's size increases, with new production capacity scheduled to come online later in the year. Margin improvement levers: Operating margin expansion was supported by productivity initiatives, bottler refranchising, and targeted cost management. Management noted some timing benefits in the quarter but reiterated a focus on sustainable long-term margin gains. Management expects the next quarter and the full year to be influenced by local consumer dynamics, continued marketing investment, and the company's ability to adapt to external volatility, such as shifting trade policies and currency fluctuations. Affordability and local relevance: Coca-Cola is prioritizing affordable product packages and emphasizing the local production of global brands to build resilience and maintain relevance amid economic and geopolitical uncertainties. Innovation and marketing: The return of the Share a Coke campaign and expansion into functional beverages, like prebiotic sodas, are expected to drive consumer engagement, particularly among younger demographics. Productivity and margin focus: Management believes ongoing cost optimization and supply chain enhancements will help offset external pressures, supporting long-term operating margin targets even as revenue growth moderates in certain regions. Dara Mohsenian (Morgan Stanley): Asked about maintaining guidance despite a strong quarter, with management citing prudence due to early-year uncertainties and anticipated tougher comparisons ahead. Bryan Spillane (Bank of America): Probed on Mexico's soft performance; CEO James Quincey highlighted macro uncertainty, calendar shifts, and the company's focus on affordability and local campaigns to restore growth. Lauren Lieberman (Barclays): Questioned responses to anti-brand sentiment in the U.S.; Quincey explained efforts to reinforce local economic impact and regain affected consumer demographics. Chris Carey (Wells Fargo): Sought clarity on sustainability of margin gains; CFO John Murphy pointed to timing benefits this quarter but expressed confidence in long-term productivity levers and investment in growth. Robert Ottenstein (Evercore): Inquired about Fairlife's growth trajectory and capacity expansion; Quincey detailed plans for new production capabilities and maintained that long-term opportunity remains substantial as the brand scales. In the coming quarters, the StockStory team will be monitoring (1) Coca-Cola's success in regaining volume momentum in North America and Mexico through targeted marketing and affordability initiatives, (2) the impact of capacity expansion on Fairlife's growth rate and category share, and (3) the effectiveness of the Share a Coke campaign and new functional beverage launches in attracting younger consumers. We will also track the company's ability to sustain margin improvements amidst potential trade and currency headwinds. Coca-Cola currently trades at a forward P/E ratio of 23.1×. In the wake of earnings, is it a buy or sell? See for yourself in our free research report. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years. Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today. Sign in to access your portfolio
Yahoo
02-05-2025
- Business
- Yahoo
There Are 400 Million Reasons Why Warren Buffett Loves This Dividend Stock. Is It a Must-Buy in May?
Durable demand, a strong brand, and pricing power have supported this stock's 16% rise in 2025, as investors view the business as a safe play. Berkshire Hathaway generates $816 million in annualized dividend income from this consumer-facing enterprise. Investors looking to outperform the market over the long term should look elsewhere. One of Warren Buffett's core investment tenets is to buy high-quality companies that possess economic moats. Having durable competitive strengths helps a business defend itself against existing rivals and new entrants to the industry. Look at Berkshire Hathaway's massive $277 billion public equity portfolio and you'll see this philosophy on full display. The conglomerate has a stake in dozens of companies, but Buffett's firm owns 400 million shares of one top dividend stock. Is it a must-buy in May? Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue » Based on the stock market's performance in 2025, investors are worried that economic conditions will worsen, and a recession could be coming soon. This backdrop isn't that much of a concern for Coca-Cola (NYSE: KO), the beverage giant that Buffett seems to love. The company exceeded Wall Street estimates in Q1 2025 (the three months ended March 28), reporting $11.2 billion in adjusted revenue, which was flat compared to the year-ago period. Management follows volume trends closely. Coca-Cola sold 2% more unit cases during the quarter than in Q1 2024. Countries like India, China, and Brazil were called out as strong markets. It's also worth mentioning the star of the show, Coca-Cola Zero Sugar, an extremely popular product that saw 14% volume growth globally. In typical fashion, Coca-Cola flexed its pricing power. Volume might not see much expansion potential, due to the company's presence in virtually every corner of the world. However, Coca-Cola's brand is so powerful, contributing to its moat, that it benefits from tremendous customer loyalty. There was a positive 5% effect due to favorable pricing and mix in the quarter. Coca-Cola might be known for selling over 200 different beverage products. But it's important to know that the business relies on third-party partners to handle bottling and packaging. The result is an extremely profitable operation. After posting a stellar 22.6% net income margin in 2024, Coca-Cola's bottom line expanded with a 29.9% margin in Q1. This setup is extremely beneficial for Buffett and Berkshire. Coca-Cola is a dividend powerhouse. In February, the executive team raised the quarterly payout, keeping a streak of a jaw-dropping 63 straight years of increases alive. Given how profitable the company is, there's minimal risk this income stream will go away anytime soon, if ever. Berkshire's 400 million shares bring in $204 million in passive income every quarter. Annualized, that figure jumps to $816 million. Understandably, Buffett has never sold a share since first buying a stake in the business in 1988. Coca-Cola has done a fantastic job at quenching the Oracle of Omaha's thirst for a safe, steady, and reliable income stream. Most would agree that Coca-Cola can provide stability to a portfolio. Investors might want nothing more in today's market environment. But to be clear, don't expect the stock to generate market-beating returns over the long term. Coca-Cola has dramatically underperformed the S&P 500 in the past five and 10 years, and I don't believe this trend will change. The price-to-earnings ratio currently sits at 29.3. This is close to the most expensive level in the past 12 months. This valuation is no doubt elevated when you consider earnings per share are projected to increase at a compound annual growth rate of 6% between 2024 and 2027. Only income investors will find the stock a must-buy in May, as the dividend yield is 2.82%. By doing this, you'll be following in Warren Buffett's footsteps. However, Coca-Cola won't provide meaningful capital appreciation. Before you buy stock in Coca-Cola, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Coca-Cola wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $610,327!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $667,581!* Now, it's worth noting Stock Advisor's total average return is 882% — a market-crushing outperformance compared to 161% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of April 28, 2025 Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy. There Are 400 Million Reasons Why Warren Buffett Loves This Dividend Stock. Is It a Must-Buy in May? was originally published by The Motley Fool Sign in to access your portfolio
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Scotsman
01-05-2025
- Business
- Scotsman
Coffee chain to giveaway free drinks to app users
Watch more of our videos on and on Freeview 262 or Freely 565 Visit Shots! now The free offer is available via the Costa Coffee app ☕ Sign up to our daily newsletter Sign up Thank you for signing up! Did you know with a Digital Subscription to Edinburgh News, you can get unlimited access to the website including our premium content, as well as benefiting from fewer ads, loyalty rewards and much more. Learn More Sorry, there seem to be some issues. Please try again later. Submitting... Costa Coffee are giving away free drinks via its app The perk includes a free bottle of Coca-Cola Zero Sugar The offer is not available to every app user A popular coffee chain in the UK will be giving away free drinks, as a way to help people cool down during the warm weather. As reported by The Sun, Costa Coffee customers can receive free Coca-Cola Zero Sugar bottles. Advertisement Hide Ad Advertisement Hide Ad The deal was shared by a Costa Coffee customer on a popular Facebook group named Extreme Couponing and Bargains UK, who shared how others can get their hands on the free drink. Coffee chain to giveaway free drinks to app users - but not everyone is eligible | Adobe Stock The original poster detailed that a free bottle Coca-Cola Zero Sugar can be redeemed via the Costa Coffee loyalty app. In the post, the Facebook user wrote: 'Free coke zero on the Costa app at the mo! Just got mine.' Advertisement Hide Ad Advertisement Hide Ad The post gained popularity on the Facebook group, with many taking to the comments to share if they had managed to receive a free Coca-Cola Zero Sugar bottle or not. It was shared that the free gift can be redeemed without the purchase of another item, however not every app user will be able to take advantage of the giveaway. The free Coca-Cola Zero Sugar offer will run out on Sunday May 4, 2025. The Costa Coffee app also offers customers exclusive early access to new menu items, the opportunity to collect points, as well as a free cake on your birthday. Advertisement Hide Ad Advertisement Hide Ad The Costa Coffee app is free to download from the App Store on iPhone or Google Play store on Android. If you have a food and drink story to share with us, we'd love to hear from you. You can now send your stories to us online via YourWorld at . It's free to use and, once checked, your story will appear on our website and, space allowing, in our newspapers.
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Scotsman
01-05-2025
- Business
- Scotsman
Coffee chain to giveaway free drinks to app users
The free offer is available via the Costa Coffee app ☕ Sign up to our daily newsletter – Regular news stories and round-ups from around Scotland direct to your inbox Sign up Thank you for signing up! Did you know with a Digital Subscription to The Scotsman, you can get unlimited access to the website including our premium content, as well as benefiting from fewer ads, loyalty rewards and much more. Learn More Sorry, there seem to be some issues. Please try again later. Submitting... Costa Coffee are giving away free drinks via its app The perk includes a free bottle of Coca-Cola Zero Sugar The offer is not available to every app user A popular coffee chain in the UK will be giving away free drinks, as a way to help people cool down during the warm weather. As reported by The Sun, Costa Coffee customers can receive free Coca-Cola Zero Sugar bottles. Advertisement Hide Ad Advertisement Hide Ad The deal was shared by a Costa Coffee customer on a popular Facebook group named Extreme Couponing and Bargains UK, who shared how others can get their hands on the free drink. Coffee chain to giveaway free drinks to app users - but not everyone is eligible | Adobe Stock The original poster detailed that a free bottle Coca-Cola Zero Sugar can be redeemed via the Costa Coffee loyalty app. In the post, the Facebook user wrote: 'Free coke zero on the Costa app at the mo! Just got mine.' Advertisement Hide Ad Advertisement Hide Ad The post gained popularity on the Facebook group, with many taking to the comments to share if they had managed to receive a free Coca-Cola Zero Sugar bottle or not. It was shared that the free gift can be redeemed without the purchase of another item, however not every app user will be able to take advantage of the giveaway. The free Coca-Cola Zero Sugar offer will run out on Sunday May 4, 2025. The Costa Coffee app also offers customers exclusive early access to new menu items, the opportunity to collect points, as well as a free cake on your birthday. Advertisement Hide Ad Advertisement Hide Ad The Costa Coffee app is free to download from the App Store on iPhone or Google Play store on Android.
