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Business Times
29-04-2025
- Business
- Business Times
Coca-Cola results beat estimates on price hikes, demand surge
[ATLANTA] Coca-Cola on Tuesday (Apr 29) reported better-than-expected revenue and profit for the first quarter, as the beverage giant benefits from price hikes and enjoys strong demand for its sodas, juices and milk offering Fairlife. The Sprite and Fanta maker also maintained its full-year organic revenue and comparable profit forecasts, unlike PepsiCo and Procter & Gamble that lowered their annual expectations as the global trade war triggered by steep US tariffs threatened to push up costs for American companies. '(Coca-Cola's) operations are primarily local, however, it is subject to global trade dynamics which may impact certain components of the company's cost structure across its markets,' it said in a statement. 'At this time, the company expects the impact to be manageable.' In the last quarter, Coca-Cola had underlined strategies to offer affordable packaging options and plans to use plastic bottles to mitigate the impact from 25 per cent tariffs on aluminum imports. 'This morning's print reaffirms our confidence in Coca-Cola's fundamentals despite a difficult macroeconomic backdrop,' RBC Capital analyst Nik Modi said. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up 'Coca-Cola reiterated top- and bottom-line guidance, which should be viewed as favourable in this environment,' he said. Shares of Coca-Cola rose 1.2 per cent in premarket trading. Rival PepsiCo last week called out subdued consumer spending, but demand for Coca-Cola's slightly pricey products has so far remained stable, helping boost sales growth despite price hikes in highly inflationary markets such as Argentina and Latin America. Its first-quarter overall average selling prices rose 5 per cent, while unit case volumes increased 2 per cent. Still, volumes in its North America market fell 3 per cent, mostly due to a slowdown in demand for its legacy brands such as Coca-Cola and Sprite, as well as coffee. In an attempt to boost demand in the region, the company has been betting on its portfolio of energy drinks and prebiotic sodas by launching new items such as Simply Pop. Its quarterly revenue fell marginally to US$11.22 billion, compared with expectations of a 0.84 per cent fall to US$11.14 billion, according to data compiled by LSEG. Excluding items, the company earned 73 US cents per share, compared with estimates of 71 US cents. REUTERS
Globe and Mail
10-04-2025
- Business
- Globe and Mail
3 Safe Stocks to Buy as the Market Moves from 1 Extreme to Another
Wall Street is in turmoil. President Donald Trump announced 'reciprocal' tariffs on U.S. trading partners on April 2, raising investor panic and leading analysts at JPMorgan and Goldman Sachs to raise their recession odds forecasts for 2025. Major stock benchmarks entered correction territory, with popular tech names selling off violently. Then, Trump announced a 90-day pause on tariffs for all trading partners except China. The stock market soared, with the S&P 500 Index ($SPX) closing up nearly 10% on Wednesday, April 9. In turbulent times like these, the consumer staples sector can act as a bulwark for an investor's portfolio. These companies experience consistent demand, steady cash flows, and have navigated business for decades or more. No matter what happens next, these three safe stocks are worth a close look here. Safe Stock #1: Coca-Cola Warren Buffett has long been a fan of Coca-Cola (KO), making KO a great safe stock for investor portfolios. Coca-Cola is now synonymous with refreshing beverages worldwide. Commanding a market cap of about $294 billion, KO stock is up almost 12.5% on a year-to-date basis. Coca-Cola is also a member of the coveted 'Dividend King' club, having raised its dividends consecutively for 50 years or more. Currently, the stock offers a dividend yield of 2.9%. Coca-Cola has consistently outperformed the market in terms of earnings in recent years with the results of its latest quarter being no exception. In Q4 2024, net revenues rose by 6% from the previous year to $11.5 billion with EPS growing by an even sharper 12.2% to $0.55. Remarkably, this marked the 15th consecutive quarter of earnings beats from the company. Coca-Cola's global infrastructure continues to give it a powerful edge as it looks to deepen its presence in emerging markets. With an extensive bottling system — nearly 200 partners worldwide — and daily consumption of its beverages reaching 2.2 billion servings, the company is well positioned to capture growing demand in developing economies where brand familiarity and distribution scale remain critical competitive advantages. Meanwhile, Coca-Cola is actively realigning its offerings and engagement models to better resonate with Gen Z consumers. One of the more strategic developments has been the introduction of a digitally driven ecosystem rolled out in 2023, crafted specifically to target the preferences and consumption habits of younger audiences. Supporting this effort is the expansion of its product lineup to include Simply Pop, a new prebiotic beverage that builds on the broader wellness trend among this demographic. Its sparkling water brand, Topo Chico, also continues to gain traction. Thus, analysts have deemed the stock a 'Strong Buy' with a mean target price of $76.86 which indicates upside potential of about 10% from current levels. Out of 22 analysts covering the stock, 20 have a 'Strong Buy' rating, one has a 'Moderate Buy' rating, and one has a 'Hold' rating. Safe Stock #2: Keurig Dr Pepper Moving from one beverage giant to another, Keurig Dr Pepper (KDP) was formed in 2018 through the merger between Keurig Green Mountain and the Dr Pepper Snapple Group. The beverage conglomerate has a strong presence in coffee, soft drinks, water, juice, and mixers, operating across hot and cold beverage categories with leading brands like Dr Pepper, 7UP, Snapple and Mott's in its portfolio. Valued at a market cap of $45.6 billion, KDP stock is up 8% on a YTD basis. Notably, the stock offers a dividend yield of 2.65%. The most recent quarter saw the company reporting a beat on both revenue and earnings. Net sales of $4.1 billion represented yearly growth of 5.2% while adjusted earnings saw 5.5% growth in the same period to $0.58, coming in ahead of consensus estimates. Overall, KDP's EPS have exceeded Street expectations in seven out of the past eight quarters. Keurig Dr Pepper is steadily transforming into a serious contender in the energy drinks space — a segment where it had virtually no presence until a few years ago. Central to this momentum is its acquisition of GHOST, a youth-driven energy drink brand that has struck a chord with Gen Z consumers. Beyond energy drinks, KDP continues to reinforce its dominance in more established beverage segments. The company's coffee platform, especially in the single-serve pod market, remains the largest in the U.S., thanks in large part to successful brand tie-ups with widely recognized players such as Starbucks (SBUX) and Dunkin'. On the soda front, Dr Pepper has climbed to second place among cola-style beverages in the U.S., capturing 8.3% of the market. Considering these factors, analysts have assigned a rating of 'Moderate Buy' for the stock with a mean target price of $38.39. This indicates upside potential of roughly 11% from current levels. Out of 17 analysts covering the stock, 10 have a 'Strong Buy' rating, one has a 'Moderate Buy,' rating and six have a 'Hold' rating. Safe Stock #3: Procter & Gamble Procter & Gamble (PG), or P&G, specializes in a wide range of personal and consumer health and hygiene products. The company's market cap currently stands at about $371 billion. PG stock is down 3.2% on a YTD basis while offering a dividend yield of 2.48%. PG is also a member of the storied 'Dividend King' club. P&G's results for the most recent quarter were impressive, with both revenue and earnings surpassing estimates. Net sales of $21.9 billion denoted yearly growth of 2% while EPS clocked growth of 2% from the year-ago period to $1.88. Impressively, this was the 10th consecutive quarter of earnings beats from the company. Notably, P&G shows strong physical expansion and AI integration, indicating long-term growth potential. On the technology front, P&G is quietly reshaping its advertising strategy by incorporating artificial intelligence. Leveraging a proprietary system known as AI Studios, the company draws upon decades of internal ad testing data to forecast the likely performance of new campaigns. This enables rapid simulation and analysis, allowing creative concepts to be evaluated in a matter of hours rather than over several weeks. The acceleration of this testing cycle has not only trimmed costs significantly but also compressed the time required for rolling out fresh marketing initiatives, enhancing agility and efficiency across its brand portfolio. Keeping this in mind, analysts have assigned a rating of 'Moderate Buy' for the stock with a mean target price of $181.88, which indicates upside potential of about 16% from current levels. Out of 27 analysts covering the stock, 16 have a 'Strong Buy' rating, two have a 'Moderate Buy' rating, and nine have a 'Hold' rating.
Axios
01-04-2025
- Business
- Axios
PepsiCo agrees to buy soda upstart brand Poppi for nearly $2B
PepsiCo has agreed to acquire prebiotic soda brand Poppi for $1.95 billion, the beverage and snack giant announced Monday morning. Why it matters: The spigot for beverage deals is opening following an agreement by Celsius to acquire Alani Nu for $1.8 billion. Zoom in: PepsiCo is striking the deal after reportedly deciding that a prebiotic soda brand it developed in-house would not succeed, per Bloomberg. The purchase price includes $300 million of cash tax benefits and an additional earn-out. The transaction is also a win for investor CAVU Consumer Partners. Catch up quick: Coca-Cola was in talks to buy Poppi last year but decided to launch its version, Simply Pop.
Express Tribune
18-03-2025
- Business
- Express Tribune
PepsiCo buys Poppi for $1.95B to gain foothold in functional drinks
Listen to article PepsiCo (PEP.O) announced its acquisition of Poppi, a prebiotic soda brand, for $1.95 billion, as the company seeks to strengthen its position in the growing "healthier soda" category. The deal comes as PepsiCo faces declining demand for its traditional sodas and snack products. Following the announcement, PepsiCo's shares rose 1.6% in early trading. The move signals PepsiCo's strategic push into the health-conscious beverage market, a segment where young consumers are increasingly favoring functional drinks over conventional sodas. Healthier beverages on the rise Consumers, particularly young Americans, are turning to healthier sodas and energy drinks, driving beverage giants to innovate. Rival Coca-Cola (KO.N) has expanded its Simply brand to introduce a prebiotic soda called "Simply Pop". Other players, including Celsius Holdings (CELH.O) and Keurig Dr Pepper (KDP.O), have also made investments in the wellness drinks market. PepsiCo's acquisition of Poppi is aimed at bolstering its presence in the prebiotic soda market, a subcategory of carbonated soft drinks (CSD) that is experiencing rapid growth. Prebiotic sodas contain beneficial ingredients that support gut health, an emerging consumer trend. The Poppi advantage Poppi, an Austin, Texas-based brand, has gained traction in recent years. The company reported a 122% increase in retail sales in the 12 weeks leading up to February 22, now holding about 1% of the total US carbonated soft drinks market, according to BNP Paribas. PepsiCo emphasized that Poppi's formulation—a mix of prebiotics, fruit juice, and apple cider vinegar—makes it a low-calorie soda with no more than five grams of sugar per serving. J.P. Morgan analyst Andrea Teixeira noted that the deal would help PepsiCo strengthen its CSD portfolio, which has lost market share to Coca-Cola and Keurig Dr Pepper in recent years. Poppi's journey: from Shark Tank to PepsiCo Founded by Stephen and Allison Ellsworth, Poppi was originally known as Mother Beverage before its rebranding in 2020. The couple pitched their soda on Shark Tank in 2018, securing the backing of investor Rohan Oza, co-founder of CAVU Consumer Partners. Oza played a key role in rebranding Poppi, giving it its signature brightly colored, fruit-forward cans, and expanding its retail presence. 'We're beyond thrilled to be partnering with PepsiCo so that even more consumers across America, and the world, can enjoy Poppi,' said Rohan Oza. Financial terms of the deal PepsiCo disclosed that the $1.95 billion acquisition includes $300 million in anticipated cash tax benefits, bringing the net purchase price to $1.65 billion. The company did not reveal additional financial details of the agreement. Allison Ellsworth: excited for the next chapter Poppi's co-founder Allison Ellsworth expressed enthusiasm about the deal, highlighting that PepsiCo's global distribution would help expand Poppi's reach. 'We can't wait to begin this next chapter with PepsiCo to bring our soda to more people – and I know they will honor what makes Poppi so special while supporting our next phase of growth and innovation,' she said. Ellsworth first developed Poppi in 2015 in her kitchen as a healthier soda alternative. She experimented with fruit juices, apple cider vinegar, sparkling water, and prebiotics, selling her creations at local farmer's markets before gaining national recognition. Legal challenges: class-action lawsuit settlement Despite Poppi's rapid success, the company has faced legal challenges. Last summer, multiple class-action lawsuits were filed against the brand, alleging that its products did not provide the gut health benefits promised in marketing materials. Poppi denied the allegations but agreed to remove references to 'gut health' from its packaging in late 2023. According to a court filing last week, Poppi has agreed to an $8.9 million settlement fund for affected consumers. A hearing on the settlement is scheduled for May 8. PepsiCo strengthens functional beverage portfolio The acquisition of Poppi aligns with PepsiCo's broader strategy to diversify its product offerings beyond traditional sodas. As rising prices continue to impact demand for Pepsi sodas and Lay's snacks, the company is investing in fast-growing health and wellness segments. With consumers shifting toward functional beverages, PepsiCo is positioning itself to compete with emerging brands and long-standing rivals like Coca-Cola.
Yahoo
17-03-2025
- Health
- Yahoo
Pepsi is acquiring the prebiotic soda brand Poppi for $1.95 billion. Which healthier-for-you soda is best?
The cans are brightly colored. The flavor combinations are innovative. The brand names are fun. And they promise they're healthier than traditional sodas. Are they? A single can of Coke has 39 grams of added sugar, meaning that just one exceeds the American Heart Association's daily sugar recommendations. A Diet Coke has no sugar or calories, but it also comes loaded with the artificial sweetener aspartame, which has been linked to potential health risks. Compare those with Poppi, which only has between 3 and 5 grams of sugar, or Zevia, which has none. Traditional soda makers are eager to get in on the action. PepsiCo announced that it is acquiring Poppi for $1.95 billion, pushing the company behind some of the most popular soft drinks into the modern soda game. In a statement, PepsiCo Chairman and CEO Ramon Laguarta said the move was to reach consumers who had a "growing interest in health and wellness" and wanted beverages that fit their lifestyle. Meanwhile, Coca-Cola launched its own line of prebiotic drinks, Simply Pop, to compete with those already on the market. Made with fruit juice and featuring no added sugar, these beverages contain 6 grams of fiber, plus zinc and vitamin C for immune support. How do these brands stack up when compared to others that claim to be better for you? Here's what to know. Curious about these new sodas but just want the highlights? Dietitians say that these drinks can be a smart swap for traditional sodas, due to their lower sugar and calorie content. These beverages can also contain good-for-you ingredients, such as fiber and probiotics, which can improve your gut health. It's important, however, to be cautious: Eating too much fiber can leave you feeling bloated and uncomfortable, especially if you aren't used to consuming it in large amounts. And while these drinks may have perks other sodas do not, a case can be much more expensive than one of traditional sodas like Coke. Overall, it's best to drink these modern sodas in moderation, and not have them replace water as your primary form of hydration. To dive deeper, keep scrolling — or, check out the information below for just the basics on each beverage. Poppi: Made with apple cider vinegar, low in calories and contains fiber Culture Pop: Contains probiotics and is sweetened with fruit juice Olipop: Features a propriety blend of botanicals, plant fibers and prebiotics to support gut health Zevia: Sweetened with Zevia and has flavors that mimic traditional sodas Simply Pop: Has 6 grams of fiber that comes from soluble corn fiber According to dietitian Chris Mohr, the fitness and nutrition adviser at Fortune Recommends Health, people may initially turn to so-called modern sodas because they typically have less added sugar and fewer calories than traditional sodas, like Coke, Dr Pepper or Sprite. What about diet soda? 'While diet drinks are low in calories, they often contain artificial sweeteners that some people prefer to avoid,' Mohr notes. Poppi, Zevia and other modern sodas feature natural sweeteners (such as monk fruit, stevia or fruit juice) instead of regular sugar or artificial sweeteners. It's what's added to these drinks that gives them a health halo and a leg up on the competition. Fiber: Some modern sodas add fiber, particularly soluble fiber like inulin from chicory root. Many Americans don't get enough fiber, which is important for managing blood sugar, lowering bad cholesterol and aiding digestion. It's worth noting, however, that the type of fiber found in sodas shouldn't replace whole food sources of fiber like fruits, vegetables and whole grains, which also provide vitamins and minerals. Probiotics and prebiotics: Some modern sodas contain probiotics and/or prebiotics, which work together to support a healthy gut. Probiotics are live bacteria that help maintain a balanced microbiome and are typically found in fermented foods like yogurt, kefir and kimchi. Prebiotics are non-digestible fibers, such as inulin (found in chicory root and other plants) that feed these beneficial bacteria, supporting their growth and activity. Apple cider vinegar: Apple cider vinegar, which contains prebiotic and probiotic properties, is commonly included in modern sodas for its potential health benefits, such as balancing blood sugar levels, improving digestion and supporting weight management. But more research needs to be done to support these claims. Natural sweeteners: Stevia and monk fruit are natural, plant-derived sweeteners that do not contain calories and do not raise blood sugar levels. Some people prefer them to artificial sweeteners like aspartame, which is found in Diet Coke, but experts have cast doubt that they have any real health benefits. How do these sodas compare with one another? Here's the breakdown of what's in each of these 12 oz. cans. Caffeine: 0-32 mg Calories: 25 per can Sugar: 3-5 grams Fiber: 2 grams Sodium: 0-35 mg Poppi features flavors like Raspberry Rose, Strawberry Lemon and Classic Cola and comes in brightly colored cans. The beverage is sweetened with natural sweeteners like stevia, as well as juice. Poppi is marketed as a gut-healthy soda, thanks to two highlighted ingredients: agave inulin and apple cider vinegar, which are said to work as both a prebiotic and probiotic. Inulin is a type of dietary fiber produced by plants that helps feed beneficial gut bacteria, which supports your overall gut health. (Poppi sources its inulin, which is also a natural sweetener, from the agave tequilana plant, according to its website.) Apple cider vinegar contains acetic acid, which may promote healthy digestion by encouraging the growth of good bacteria and maintaining a balanced gut environment. There is some controversy over Poppi's health claims, however. A May 2024 lawsuit alleged that there isn't enough of these ingredients in each can to actually make a difference in terms of gut health. Research suggests you'd need to drink more than four cans daily for 21 days to see any benefits. In terms of caffeine, only two of Poppi's nine flavors contain it: Classic Cola and Doc Pop, which each have 32 mg of caffeine from what the website lists as 'natural caffeine.' Pros: Low calories, fun and nostalgic flavors, fiber Cons: Potentially overblown health benefits Caffeine: None Calories: 45 calories Sugar: 8 grams Fiber: None Sodium: 40-50 mg Culture Pop is marketed as a sparkling probiotic soda and comes in flavors like Orange Mango, Wild Berries and Lime, Pink Grapefruit and Ginger and Black Cherry. It's sweetened, per its website, with 'organic fruit juices mixed with herbs and spices.' The beverages do not contain artificial sweeteners, refined sugar or natural sugar alternatives such as stevia. The brand's probiotic claims come from a probiotic strain called Bacillus subtilus, which Culture Pop's website says is 'clinically shown to support and improve critical functions in our bodies including digestion, gastrointestinal balance and immunity.' Pros: Contains probiotics, no artificial or natural sweeteners Cons: Higher in calories and sugar than other brands Caffeine: 0-50 mg Calories: 35-50 Sugar: 2-5 grams Fiber: 5-9 grams Sodium: 25-45 mg Olipop, touted as a 'healthy probiotic soda,' is sweetened with stevia, monk fruit and small amounts of fruit juices. Olipop's ingredients feature its proprietary OLISmart blend, which, according to its website, includes botanicals, plant fibers and prebiotics designed to support gut health. Key ingredients include cassava root, chicory root, Jerusalem artichoke, nopal cactus, calendula flower, kudzu root, marshmallow root, acacia fiber and guar fiber. 'Sure, we could have used just one prebiotic fiber in OLISmart, but the reason we use three is because different bacterial species in your gut like different foods, so OLISmart aims to feed a diverse population of microbes with these different prebiotics,' the Olipop website reads. Most flavors of Olipop do not contain caffeine, but there are four flavors that do: Vintage Cola, Cherry Cola, Doctor Goodwin and Ridge Rush. Each of these flavors contain 50 mg of 'natural caffeine from green tea,' per the website. Crisp Apple, Ridge Rush, Classic Root Beer, Classic Grape, Cherry Cola, Strawberry Vanilla, Lemon Lime and Banana Cream all have 50 calories, while the rest of the flavors have 45 or fewer calories. Pros: A significant amount of added fiberCons: More sodium than other brands Caffeine: 0-55 mg Calories: 0 Sugar: None Fiber: None Sodium: 0-70 mg Unlike other modern sodas on the market, Zevia is best known for what it does not contain, as opposed to what it does. All flavors of Zevia — which includes Cola, Ginger Ale, Creamy Root Beer and Black Cherry — are sweetened with the natural sweetener stevia, hence its name. (Specifically, it is sweetened with stevia leaf extract.) Other ingredients include carbonated water, natural flavors, tartaric acid and citric acid, plus caffeine, depending on the flavor. Zevia is also the only calorie-free option on this list. The caffeine content also varies across flavors: Cola contains 45 mg, Dr. Zevia contains 42 mg, Mountain Zevia contains 55 mg, Vanilla Cola contains 45 mg and Cherry Cola has 38 mg. The rest of the flavors do not contain caffeine. Pros: Calorie- and sugar-free Cons: No added benefits, like fiber or probiotics Caffeine: Not stated Calories: 50-60 Sugar: 9-10 grams Fiber: 6 grams Sodium: 25 mg Coca-Cola's new modern soda line, which is described as a 'prebiotic,' is made with real fruit juice and no added sugar. The line features the flavors Strawberry, Lime, Pineapple Mango, Fruit Punch and Citrus Punch. Simply Pop, which is part of Coca-Cola's Simply Beverages brand, contains 6 grams of fiber stemming from soluble corn fiber, a type of fiber made from cornstarch. Soluble fiber is fiber that dissolves in water — supporting digestion, regulating blood sugar and promoting a feeling of fullness. However, consuming too much fiber can impact gut health and cause discomfort. One thing that makes this new line stand out is the addition of zinc and vitamin C, which the brand says is added to 'support immune health.' There is research to show that these ingredients may benefit our immune system: Both zinc and vitamin C have been shown to reduce the length of a common cold, for example. Too much of either, however, can lead to side effects such as nausea, gastrointestinal issues and nutrient imbalances, so moderation is key. Pros: Contains fiber, zinc and vitamin C Cons: Higher in calories and sugar than some other brands While it depends on which soda you are drinking, there are some things to keep in mind when you reach for one of these cans. Renee Korczak, a dietitian and adviser for Olipop, tells Yahoo Life that some people may experience gastrointestinal issues if they drink fiber-rich sodas — especially if they are not used to eating a lot of fiber in their diets. 'These symptoms are completely normal, as your gut adapts to new fiber types and various functional ingredients,' she explains, noting that people with gastrointestinal issues may want to talk to their doctors before drinking these beverages. 'I typically advise clients to start slow and low with a new functional beverage and increase water intake. Instead of consuming a whole can, start with a couple of fluid ounces, and then gradually work your way up. Your gut will adapt and thank you for it.' Mohr adds that while these drinks are 'marketed as healthier,' they are still soft drinks and are 'best to have more occasionally rather than regularly.' Even low-calorie beverages can add up if you drink more than one per day, and you'll want to keep tabs on how much sugar and sodium you're taking in. Another thing Mohr wants people to keep in mind is that these drinks are 'not a substitute for water.' Make sure to keep up with your hydration by drinking enough H2O throughout the day as well. Lastly? These drinks are expensive, says Mohr. While a 12-can sleeve of Coke may cost $7 to $10, a 12-pack of Poppi clocks in at about $29. You're better off, she says, spending that money on nutrient-rich food, not soda. This article was originally published on Feb. 20, 2025 and has since been updated.
