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Yahoo
28-05-2025
- Business
- Yahoo
Shell Reshapes Operations in Indonesia With Fuel Business Divestment
Shell plc's SHEL Indonesian affiliate has taken a bold step in reshaping its business strategy by divesting fuel retail operations to a joint venture between Citadel Pacific Limited and Sefas Group. This transaction includes the transfer of around 200 gas stations and a fuel storage terminal located in Gresik, with completion expected by next year. Despite this move, Shell remains firmly rooted in Indonesia. The company emphasized that it will continue to operate under brand licensing agreements, maintaining visibility and legacy in the region. The acquiring joint venture brings together the strengths of two long-standing Shell partners. Citadel Pacific, a private holding company based in the Philippines, has its presence across various industries like aviation-related services, telecommunication, gas distribution and fuel marketing. The company licenses the Shell brand across multiple territories, including Guam, Hong Kong and Macau. Sefas Group, on the other hand, is Indonesia's largest Shell lubricants distributor. Their collaboration signals continuity for customers and partners, backed by a solid history of representing the Shell brand across various markets. While Shell is stepping away from fuel retailing, it is optimizing the portfolio by doubling down on the lubricants business in Indonesia, a market described as key for growth. Shell operates a major lubricant blending plant in the country with a capacity of up to 300 million litres annually and a new grease manufacturing plant is currently under construction. With this repositioning, Shell reinforces its strengths in high-growth, high-margin segments that can alleviate its profitability in the future. London-based Shell is one of the primary oil supermajors, a group of U.S. and Europe-based big energy multinationals with operations that span almost every corner of the globe. Currently, SHEL has a Zacks Rank #5 (Strong Sell). Investors interested in the energy sector might look at some better-ranked stocks like Flotek Industries, Inc. FTK, Global Partners LP GLP and RPC, Inc. RES. While Flotek Industries and Global Partners currently sport a Zacks Rank #1 (Strong Buy) each, RPC carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here. Flotek Industries develops and delivers prescriptive chemistry-based technology, including specialty chemicals, to clients in the energy, consumer industrials and food & beverage industries. The Zacks Consensus Estimate for FTK's 2025 earnings indicates 55.88% year-over-year growth. Global Partners is a Delaware limited partnership formed by affiliates of the Slifka family. The company owns, controls or has access to one of the largest terminal networks of refined petroleum products in New England. The Zacks Consensus Estimate for Global Partners' 2025 earnings indicates 17.84% year-over-year growth. Atlanta, GA-based RPC is an oilfield service provider in almost all of the prospective plays, like the Rocky Mountain regions, Appalachian area, Gulf of Mexico and other resources in the United States. The Zacks Consensus Estimate for RES' next quarter earnings indicates 33.33% growth. 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 Global Partners LP (GLP) : Free Stock Analysis Report RPC, Inc. (RES) : Free Stock Analysis Report Flotek Industries, Inc. (FTK) : Free Stock Analysis Report Shell PLC Unsponsored ADR (SHEL) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
27-04-2025
- Business
- Yahoo
Coca-Cola Pre-Q1 Earnings: Do Positive Business Trends Suggest a Buy?
The Coca-Cola Company KO is slated to report first-quarter 2024 earnings on April 29, before the opening bell. The company is expected to register year-over-year top and bottom-line declines when it reports first-quarter Zacks Consensus Estimate for first-quarter earnings is pegged at 71 cents per share, indicating a 1.4% decline from the prior-year quarter's reported figure. The consensus mark for earnings has moved down by a penny in the past 30 days. For quarterly revenues, the consensus mark is pegged at $11.1 billion, implying a 1.6% decline from the year-ago quarter's reported figure. (See the Zacks Earnings Calendar to stay ahead of market-making news.)The Atlanta, GA-based company has been reporting steady earnings outcomes, as evident from its positive top and bottom-line surprise trends in the trailing eight quarters. Coca-Cola delivered a trailing four-quarter earnings surprise of 5.3%, on average. On the last reported quarter's earnings call, the company registered an earnings surprise of 7.8%. Given its positive record, the question is, can KO maintain its momentum? Our proven model does not conclusively predict an earnings beat for KO this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that is not the case here. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP has a Zacks Rank #3 and an Earnings ESP of -0.86%. You can see the complete list of today's Zacks #1 Rank stocks here. Coca-Cola demonstrates resilience, fueled by strong business momentum, including a diverse brand portfolio, strategic investments and consistent revenue growth across its segments. This upward trajectory has been supported by effective pricing strategies and increased the first quarter of 2025, Coca-Cola's price/mix is projected to have gained from both price hikes and a favorable product mix. Pricing strength is expected to have stemmed from proactive adjustments in inflation-impacted markets, alongside routine pricing initiatives. Additionally, a positive mix shift in several developed markets is expected to have bolstered the company's anticipate favorable price/mix trends to have fueled the company's first-quarter performance. Our model forecasts a 5.2% year-over-year increase in organic revenues for the first quarter, driven by a 4.1% rise in the price/mix and a 1.1% increase in concentrate first-quarter results are expected to reflect gains from innovations and increased digital investments. E-commerce has surged, with growth rates doubling in many countries. KO has accelerated investments in digital capabilities, enhancing consumer connections and piloting digital initiatives to capture online demand, likely boosting first-quarter revenues. CocaCola Company (The) price-eps-surprise | CocaCola Company (The) Quote Despite a favorable price/mix in most markets, macroeconomic challenges are expected to have impacted KO's first-quarter performance. Factors such as low consumer confidence in China, geopolitical and economic instability in Eurasia and the Middle East, and high inflation in Argentina are expected to have weighed on Coca-Cola's top-line the last reported quarter's earnings call, management noted that inflation was normalizing in developed markets, but developing and emerging markets continue to experience high inflation, leading to elevated pricing and currency headwinds. These inflationary pressures and currency fluctuations are expected to have affected some segments in the first on the current rates and impacts of hedged positions, the company anticipates currency headwinds to have influenced first-quarter 2025 revenues by 3-4%. Additionally, acquisitions, divestitures and structural changes are expected to have negatively impacted revenues by 2-3% in the to-be-reported quarter. Comparable EPS growth is likely to have included headwinds of 5-6% from currency, and 2-3% from acquisitions, divestitures and structural model estimates a 3.6% impact on first-quarter revenues from currency headwinds, and a 2.4% impact of acquisitions, divestitures and structural adjustments. KO shares have exhibited an uptrend, rising as much as 18.8% in the past year. The stock has surpassed the broader industry and the Consumer Staples sector's 1.9% and 3.4% growth, respectively. The KO stock also outperformed the S&P 500 index, which increased 5.2% in the same period. Image Source: Zacks Investment Research The Coca-Cola stock has outperformed its competitor PepsiCo Inc. PEP, which has declined 19.5% in the past year. The stock has also outpaced Keurig Dr Pepper Inc. KDP and Monster Beverage Corporation's MNST growth of 11.2% and 4%, respectively, in the same the valuation standpoint, KO trades at a forward 12-month P/E multiple of 24.19X, exceeding the industry average of 19.36X and the S&P 500's average of 19.6X. Coca-Cola's valuation appears quite undoubtedly commands a high valuation, reflecting its strong market positioning, brand power and long-term growth potential compared with other non-alcoholic beverage companies. However, we believe that its valuation is too stretched at this time. Image Source: Zacks Investment Research Coca-Cola remains a powerhouse in the beverage industry, commanding more than 40% of the global non-alcoholic beverage market. The company's enduring success is driven by a formidable market presence, world-class marketing capabilities, and a relentless focus on innovation. With a portfolio boasting more than 4,700 products and above 500 brands, spanning sodas, juices, waters and energy drinks, Coca-Cola continues to reinforce its dominant market share, broad product range, and strategic emphasis on innovation and digital transformation position it well for sustained long-term growth. However, short-term headwinds such as inflationary pressures, global macroeconomic uncertainties and unfavorable currency fluctuations remain challenges to navigate. Regardless of how Coca-Cola's stock reacts to its first-quarter 2025 earnings, it remains a compelling long-term investment, underpinned by strong profitability and an expanding global footprint. Prospective investors should carefully evaluate the current valuation before entering a position. For existing shareholders, holding on to the KO stock is advisable, as the upcoming earnings release is expected to reaffirm the company's resilience and long-term growth potential. 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 PepsiCo, Inc. (PEP) : Free Stock Analysis Report Monster Beverage Corporation (MNST) : Free Stock Analysis Report Keurig Dr Pepper, Inc (KDP) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Sign in to access your portfolio
