Two Factors Pushing Upward Revisions For Coke

Coca-Cola Co. (KO) beat the consensus by US3¢ with its third quarter earnings on Wednesday morning, demonstrating that its business remains on solid ground.

Goldman Sachs analyst Judy Hong says two factors should push upward revisions to consensus estimates.

The first is that Coke’s business performance is well ahead of its long-term growth targets of 3% to 4% for volume and 6% to 8% for earnings before interest and taxes. The other factor is the company’s lower tax rate and indicated foreign exchange gains.

As a result, Coke should see a boost for its numbers over the balance of the year and into 2008, Ms. Hong told clients in a note.

While she said the results will likely be neutral for Coke shares, the analyst’s estimates and price target were put under review.