Sep. 18, 2015, 6:26 PM
- Coca-Cola (KO -1%) said today that the IRS says it may owe $3.3B in back federal taxes due to foreign transfer pricing -- a tax issue that usually hits technology and pharmaceutical companies instead.
- The IRS also recommended the issue be designated for litigation, finding that Coca-Cola's income from 2007-2009 should have been reported to be higher. Last year, it reported an effective tax rate of 23.6%, below the U.S. statutory rate of 35%, due to a higher percentage of operating income coming overseas.
- The increasingly frequent issue hits multinationals over where they log profits. The IRS accuses companies of moving profits to countries with lower tax rates. In Coca-Cola's case, it's about how it profits from sales of soda concentrate from its worldwide concentrate plants.
- In an 8-K, Coca-Cola said it "firmly believes that the assessments are without merit and plans to pursue all administrative and judicial remedies necessary to resolve this matter."
Sep. 17, 2015, 9:34 AM
- Coca-Cola (NYSE:KO) and PepsiCo (NYSE:PEP) play a role in the proposed Megabrew merger of SABMiller and Anheuser-Busch InBev.
- A-B and Pepsi are partners in many Latin American territories, while SABMiller and Coca-Cola have joint bottling ventures in Africa and some Caribbean markets.
- Morningstar warns the Megabrew would require a termination of a bottling deal with either Coca-Cola or PepsiCo, while other beverage industry analysts aren't so sure a deal couldn't be worked out to expand distribution strategically.
- A-B's contract with PepsiCo expires at the end of 2017, but written notice has to be submitted before the end of this year to prevent an automatic renewal. That ticking clock could push a deal decision closer.
- Previously: Anheuser-Busch InBev rocks the food and beverage sector (Sep. 16 2015)
- Previously: More about an Anheuser-Busch InBev, SABMiller merger (Sep. 17 2015)
Sep. 14, 2015, 11:15 AM
- With market eyes on a Fed rate-hike decision considered to be a bit of a toss-up amid differing opinions, Goldman Sachs is banking on the (slightly) more dovish position that the agency will wait until December. The bank is still laying out how to play the hike when it invariably comes.
- Strength in balance sheets is what you need, it says, noting that those companies outperform (by an average 5%) in the three months after a rate-boosting cycle begins. In Goldman's "High Quality Stock" basket: CMG, DLTR, PEP, KMI, BLK, GOOG, AAPL, PCLN, ORCL, WFC.
- Meanwhile, it suggests avoiding companies with high floating-rate debt as they bear the brunt of a move away from near-zero interest rate policy. "When the tightening cycle finally starts, the immediate impact will be felt by firms with high proportions of variable rate borrowing."
- Included in that "avoid" list: CL, COL, JNJ, AAPL, EBAY, MET, KO, GIS, F, MCD, GM, TWX, CVX, AGN, MON.
- (Yes, cash-rich Apple made both lists, having a strong balance sheet along with floating debt.)
Sep. 11, 2015, 7:13 AM| Sep. 11, 2015, 7:13 AM | 7 Comments
Sep. 2, 2015, 1:11 PM
- New legislation in New York aims to ban the sale of soda drinks in servings of over 16 ounces to children under the age of 18.
- The bill from New York City assemblyman Matthew Titone is narrower in scope than ex-NYC Mayor Michael Bloomberg's efforts to ban large-sized soda drinks.
- Related stocks: MNST, KO, PEP, DPS.
Aug. 28, 2015, 2:27 AM
- According to forecasts from Beverage Marketing, bottled water sales volume grew at a rate of 7% in the U.S. last year to put it on pace to outsell soda by 2017.
- That's not necessarily all bad news for Coca-Cola (NYSE:KO), Pepsi (NYSE:PEP) and Nestle (OTCPK:NSRGY), which offer several bottled water brands, though it's not an ideal trend.
- The wholesale gallon price of water fell 25% over the past decade compared to a 33% rise in soda prices, and more companies continue to pour into the market.
- Previously: Beverage companies shift focus to water (Jan. 15 2014)
Aug. 25, 2015, 7:44 AM
- Coca-Cola (NYSE:KO) expects to reach a water replenishment goal set originally for 2020 by the end of this year.
- The company is already at a 94% water replenishing level.
- A broad network of upgraded wastewater processing facilities has helped Coca-Cola smash its target date.
Aug. 19, 2015, 11:38 AM
- Large food companies need to focus on bold M&A and innovation actions over recharging iconic brands, concludes Rabobank in a new report on the sector.
- A shift in consumer preferences has sparked a need to introduce new brands which are on trend - instead of focusing on "innovation-lite" and product reformulation strategies. Buying promising brands at an earlier stage than normal is seen as a forward-thinking strategy.
- Related stocks: KHC, MDLZ, PEP, KO, OTCPK:NSRGY, OTCPK:NSRGF, WWAV, HAIN, K, GIS, POST, CPB, PF, THS.
Aug. 19, 2015, 4:18 AM
- Following the corruption scandal at FIFA, corporate sponsors pondered whether to back away from the powerful marketing outlet, but it now looks like they are getting more involved.
- Soccer's governing body is now scheduled to meet several of its commercial partners on Thursday, after Coca-Cola (NYSE:KO) and Visa (NYSE:V) urged the creation of an independent group to oversee reforms.
- FIFA collected $1.6B in sponsorship money in the four years leading up to the 2014 World Cup, nearly half of which came from its six top "partners" (Coke, Visa, McDonald's (NYSE:MCD), Adidas (OTCQX:ADDYY), Emirates and Hyundai (OTC:HYMLF)).
Aug. 14, 2015, 5:56 PM
- Berkshire Hathaway (BRK.A, BRK.B) disclosed in its latest 13F filing that it sold off its shares in Phillips 66 (NYSE:PSX) and National Oilwell Varco (NYSE:NOV) during Q2, as it continued to cut its positions in energy companies.
- Meanwhile, BRK kept unchanged its stakes in its “Big Four” holdings American Express (NYSE:AXP), Coca Cola (NYSE:KO), Wells Fargo (NYSE:WFC) and IBM.
- Warren Buffett seemed to hint during a CNBC interview this week that BRK may have built up its IBM stake in the current quarter, saying "I love it when it goes down" when asked whether he was concerned about the stock’s recent performance.
- Buffett’s only new stake in the quarter was a 20M-share investment in auto paint maker Axalta Coating Systems (NYSE:AXTA), which BRK bought from Carlyle Group.
Aug. 14, 2015, 8:30 AM
- Coca-Cola (NYSE:KO) has a new game plan for the C-suite after elevating James Quincey to the COO position.
- During a conference call it was outlined that CEO Muhtar Kent will handle long-term strategy and innovation, while Quincey is tasked with improving productivity and growth throughout the company.
- Previously: Coca-Cola hires from within for COO position (Aug. 13 2015)
Aug. 13, 2015, 8:12 AM
- Coca-Cola (NYSE:KO) names insider James Quincey as the company's new COO, effective immediately.
- The exec served most recently as the president of Coca-Cola's Europe business.
- Quincey will report directly to CEO Muhtar Kent.
Aug. 12, 2015, 12:47 PM
- Corn prices have swung sharply lower after the USDA raised a forecast for corn production off of improved yields.
- The corn crop is seen coming in at 13.686B bushels vs. 13.53B prior forecast and 13.332B consensus estimate.
- Food sellers could see some back-half cost and feed relief if the trend holds.
- Related stocks: GIS, K, POST, KO, PEP, PPC, CPB, TSN, SEB, SJM.
- Related ETF: CORN
- USDA Crop Production report.
Aug. 7, 2015, 12:57 PM
Aug. 7, 2015, 2:31 AM
- Three Coca-Cola bottlers have agreed to a merger combining $12B in revenue across 13 European countries, as part of a global consolidation push by Coke (NYSE:KO) to cut costs amid slowing sales.
- Under the new tie-up, Coca-Cola Enterprises (NYSE:CCE) would relocate its headquarters to the U.K., merging with Spanish and German operations to form "Coca-Cola European Partners".
- The bottlers expect the move to generate annual cost savings of $350M-$375M within three years.
- Previously: Coca-Cola Enterprises to combine with two other European bottlers (Aug. 06 2015)
Aug. 6, 2015, 8:00 AM
- Confidence in Keurig Green Mountain (NASDAQ:GMCR) erodes after the company lowered guidance and announced it would reduce its workforce by 5%.
- The job reduction is the largest in the company's history.
- Execs with Keurig Green Mountain acknowledged competitive pressure in the marketplace without going into specifics during the firm's earnings call.
- The sharp drop in GMCR share price is relevant to Coca-Cola (NYSE:KO) which has a 16% stake in the company.
- Earnings call transcript
- Previously: Keurig Green Mountain beats by $0.01, misses on revenue (Aug. 05 2015)
- Previously: Sales fall at Keurig Green Mountain, new $1B buyback unveiled (Aug. 05 2015)
- GMCR -30.19% premarket to $52.34.
The Coca-Cola Co. is a beverage company, which provides diet and regular sparkling beverages and still beverages. The company's portfolio of brands include Diet Coke, Fanta, Sprite, Coca-Cola Zero, vitaminwater, Powerade, Minute Maid, Simply and Georgia. It operates through seven segments:... More
Sector: Consumer Goods
Industry: Beverages - Soft Drinks
Country: United States
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