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- While General Mills and Coca-Cola have grown exceptionally for decades, they have both stumbled during the last 2 years.
- Amid lack of growth projects, the managements of the two companies have initiated wide restructuring programs in order to reduce their costs.
- The article also details some other policies of the managements of the two companies.
Coca-Cola Misses Estimates As Management Is Scrutinized
Coca-Cola: The Strong Dollar Takes The Fizzle Out Of This Dividend ChampAlbert Alfonso • Tue, Dec. 16
- Coca-Cola is projecting a weak 2015.
- The strong dollar and restructuring costs are mostly to blame.
- At current prices, Coca-Cola yields right around 3%.
- KO has failed to grow in the last 2 years, with lack of growth expected next year as well.
- The article analyzes all the issues and moves of the company, which were discussed in the conference call after the earnings release and in the presentation yesterday.
- While the shareholders should have minimum expectations from the restructuring initiative of KO, the deals that take advantage of the unique distribution system of the company are quite promising.
- Management’s evasion of core problem remains troubling.
- Long-term revenue decline not inevitable.
- Comparison with PepsiCo reveals over-valuation.
- Despite recent price drop, my Levered Returns model still predicts some downside.
Dividend Aristocrats In Focus Part 53 Of 54: Coca-Cola (KO)
- Coca-Cola has 17 billion-dollar brands.
- The amount Coca-Cola spends on advertising per year may shock you.
- See what makes Coca-Cola the leading global beverage business.
- KO has suffered from a shrinking soda market in recent years.
- Attempts to jump start growth have done little to stem the tide of falling soda sales.
- Coke's valuation is stretched thin and is too risky despite the dividend.
Reflections On Coca-Cola: Lessons Learned From The Seeking Alpha Dividend Community
- I respond to a recent article I wrote about possibly selling my core position in Coca-Cola and the responses that it generated.
- DGI life lessons broken down and contemplated.
- I can't say enough about my appreciation for the DGI community here at SA, and this piece shows why.
- Coca-Cola is entering the dairy sector with its own brand of premium high quality milk called Fairlife, with hopes to revive sales that have flat lined.
- Coca-Cola reported diluted earnings per share of $0.48 compared to $0.54 per share in the year ago quarter. Results were lower than analysts’ consensus of $0.53 per share.
- The company has planned on engaging in a rigorous cost cutting program as a result, planning to slash up to $3 billion a year from its operating costs.
- Its milk processing methods will incorporate a new proprietary ultra filtering process which heightens protein content and brings down lactose content in milk.
- Currently, existing investors should hold on to their stock as the company has positioned itself for long term growth via its entry into the dairy sector.
They Say The End Is Near: It's 2004 All Over Again For Coca-Cola
- In 2004, investor sentiment toward Coca-Cola hit an extreme low capped by a brutal editorial against KO management in the New York Times.
- We have seen similar levels of negativity over the past month.
- Critics are focused solely on weakness in developed markets; strength in developing markets will more than make up for this.
- The long-term opportunity in KO today resembles that of 2004.
Why I'm Considering Selling My Core Position In Coca-Cola
- I discuss what I look for when buying a stock and look at whether or not Coke still meets those requirements.
- I explain why, even as a dividend growth invester, I focus on the value of my holdings rather than primarily on income.
- I examine the potential over-valued nature of KO using several F.A.S.T. Graphs.
Rich Cash Return Policy Key Feature In Coca-Cola's Bullish Thesis
- Product innovations, aggressive advertisements and effective partnership agreements supporting financial performance.
- Company has accelerated cost-cutting efforts, keeping margins and bottom-line healthy in long run.
- Has attractive cash return policy, supported by strong cash flows.
David Winters Ravages Coca-Cola's Board Once Again, Stating The Dividend Is At Risk
- David Winters is at it again, taking offense to Coke's newly released executive compensation package.
- Winters is some one to watch as he successfully pressured the board to amend the pay package.
- He even shamed Warren Buffett into abstaining from voting for the plan.
- Is he serious when he states the dividend could be at risk?
Dividend Zombies - Coca-Cola YDP Analysis And Fair Value Appraisal (Part 5)
- Dividend Zombies are income equities that have survived more than 100+ years with unbroken and undiminished dividend distributions. These are the 8 income machines that can’t be killed.
- Coca-Cola began its Zombie run in 1893, now in its 123rd year.
- Coke's moats are broad and deep, with a global footprint, most recognized logo in the world, 500+ brands and financial might to beat all competitors or simply swallow them.
- Current fair value price is $43.57, just 2% above the November 12th market.
- Revenue continues to struggle due to lower demand for soda.
- Higher marketing and new products has been driving demand in the International market.
- Valuation numbers show that earnings are expected to grow in the future.
Coca-Cola's Monster Deal Gives Me Long-Term Optimism
- Coca-Cola has been experiencing struggles in its core carbonated beverages business, particularly in North America.
- Coca-Cola's recent investment in Monster is a smart way for the company to scale external product innovation that can leverage its massive distribution system.
- I own Coca-Cola in my dividend portfolio and remain optimistic on its future prospects, current issues notwithstanding.
Coca-Cola Has Growth, Margin And Capital Deployment Problems
- Growth in unit case and concentrate volume has slowed from an average of 4.5% to 1.8% over the past two years. This is the measure of consumer demand.
- Demand creation expense, when considered as a percentage of revenue, has decreased over the past ten years, while net income as a percentage of revenue has also declined.
- Corrective action is underway: however, this appears inadequate and will take time. Success is not assured.
- The company owns or licenses over 500 brands, and has not undertaken a strategy of culling the brands and focusing on winners.
- Buyback activity is excessive at current price levels and takes capital away from more productive uses.
- Coca-Cola’s third quarter results came in as a disappointment for its investors as revenues remained flat, volumes increased by only 1% and as profits tumbled by 14%.
- Share prices slipped by 6% in the market following the announcement of these results.
- The management of the company intends on making $3 billion in cost savings by 2019 to improve bottom lines in the future.
- The company has carried out a number of strategic partnerships and acquisitions over this year to strengthen its product portfolio.
- The company has adjusted its future outlook downwards and stated that 2015 will be a challenging year as well.
Coca-Cola Or PepsiCo: Which Beverage Titan Posted Stronger Q3 Results?
- Coca-Cola released Q3 earnings on October 21.
- PepsiCo released Q3 earnings on October 9.
- Which company reported the better quarter?
- The iconic name brand associated with Coca-Cola is consistently losing market share in recent years.
- Much of the loss in market share is due to changes in consumer tastes as Americans try to choose healthier options.
- Coca-Cola could grow its market share by acquiring a company like Zevia, which makes sugar-free all-natural Soda.
Wed, Sep. 3, 9:21 AM| 2 Comments
Wed, Aug. 20, 8:48 AM
- Coca-Cola Amatil (OTCPK:CCLAY) is facing a serious profit squeeze in Indonesia with currency swings and higher costs significant factors.
- The company is also spending heavily in the nation in an effort to boost the Coke brand.
- YTD earnings from Amatil's Indonesia and Papua New Guinea division are off 80% YTD.
- Coca-Cola (NYSE:KO) has a 29% stake in the Australian soft drinks concern.
Sat, Aug. 16, 8:25 AM
- So why didn't Coca-Cola (NYSE:KO) just go all the way and acquire all of Monster Beverage (NASDAQ:MNST) instead of stopping at an asset swap and a 16.7% stake?
- More than anything, "it's about protecting the [Coke] brand and the image" from a company that urges consumers to "unleash the beast" with drinks such as Assault and Khaos, said a person close to Coke.
- Coke figures it deals with enough controversy from those who blame sugary sodas for obesity and diabetes; it wants to keep at arm's length from the more serious public relations battles facing the energy drinks industry, including an FDA probe over deaths possibly linked to Monster.
- On the financial side, the deal involves a reasonable $2.1B cash up front, while a full acquisition would have required at least $12B based on Thursday's closing stock price - roughly equivalent to the amount of cash Coke had on hand at the end of July.
- Despite the cautious approach, Coke could still own Monster some day; a standstill agreement limits KO to increasing its stake to 25% over four years, but MNST's board can waive it at any time.
Thu, Aug. 14, 4:51 PM
- Coca-Cola (NYSE:KO) is acquiring a 16.7% stake in Monster Beverage (NASDAQ:MNST) as part of a strategic alliance. Coke will make a $2.15B net cash payment to Monster at the time of the deal's closing, which is expected in late 2014 or early 2015.
- As part of the deal, Monster will transfer its non-energy businesses to Coke, and "enter into expanded distribution agreements." Monster will transfer its Hansens Natural Sodas, Peace Tea, Huberts Lemonade and Hansens Juice Products brands, among others.
- At the same time, Coke will "transfer ownership of its worldwide energy business, including NOS, Full Throttle, Burn, Mother, Play and Power Play, and Relentless," to Monster.
- Coke will have two directors on Monster's board. The partnership follows Coke's February deal with Keurig Green Mountain. Coke: "Our equity investment in Monster is a capital efficient way to bolster our participation in the fast-growing and attractive global energy drinks category."
- Monster: "Our agreement enables us to focus on our core energy business, while leveraging the strength of The Coca-Cola Companys powerful distribution and bottling system on a worldwide scale."
- MNST +25.6% AH.
Thu, Aug. 14, 3:38 PM
- Tiger Global Management was active in buying and exiting positions in consumers stocks over the last quarter, according to th hedge fund's most recent filing.
- New positions: Netflix (NASDAQ:NFLX), Vera Bradley (OTC:VERA), Coca-Cola (NYSE:KO).
- Increased: 21st Century Fox (NASDAQ:FOXA) to 19.26M shares; Restoration Hardware (NYSE:RH) to 3.193M shares.
- Maintained: Burger King (NYSE:BKW) at 7.2M shares, MasterCard (NYSE:MC) at 3.44M shares, Dollar General (NYSE:DG) at 7.893M shares.
- Exits: SodaStream (NASDAQ:SODA), Kate Spade (NYSE:KATE), Carter (NYSE:CRI).
- SEC Form 13F
Fri, Aug. 8, 12:36 PM
- Research from Moody's indicates diet soda sales are in a protracted slump that could continue.
- Diet and low-calorie soda sales fell 5% Y/Y in 2013 and the trend has persisted in 2014.
- Bottled water and energy drinks will provide some of the lost volume as beverage companies adjust, according to Moody's.
- Related stocks: PEP, KO, DPS, MNST.
Wed, Aug. 6, 1:54 PM
- A number of consumer staples stocks are in favor with investors as they shift their focus to a defensive posture and dividend yields.
- Some of the names showing outsized gains include PepsiCo (PEP +1.5%), Clorox (CLX +1.6%), Revlon (REV +1.6%), Colgate-Palmolive (CL +1.5%), Coca-Cola (KO +1.6%), Kraft Foods Group (KRFT +2%), and Procter & Gamble (PG +1.7%).
- It's no coincidence that the Consumer Staples ETF (NYSEARCA:XLP) is up 0.8% for the day to best market averages.
Tue, Aug. 5, 4:02 PM
- Coca-Cola (NYSE:KO) and PepsiCo (NYSE:PEP) plan to offer more mini-can products as a way to stoke volume growth.
- The category has done well as some consumers replace drinking diet versions of their favorite soda with a smaller-sized bottle or can.
- A higher mix of mini-can sales is a margin-booster for the companies with the per-ounce revenue almost double for mini cans than regular cans.
Tue, Aug. 5, 12:08 PM
Mon, Aug. 4, 12:22 PM| Comment!
Mon, Jul. 28, 3:31 PM
- A number of consumer goods companies that sell widely to retail chains are under-performing market indexes today after Dollar Tree announced it will buy out Family Dollar.
- Consolidation in the retail sector could give some leverage to the store chains as their scale broadens, according to Belus Capital Advisors' Brian Sozzi.
- On watch: PepsiCo (PEP -0.7%), Coca-Cola (KO -0.7%), Kraft Foods (KRFT -0.1%), Procter & Gamble (PG -0.4%), Colgate-Palmolive (CL -0.3%), Energizer Holdings (ENR -0.8%), Kimberly-Clark (KMB -0.3%).
- Related ETFs: XLP, VDC, FXG, IYK, RHS, FSTA, UGE, SZK
Wed, Jul. 23, 4:11 PM
- Wintergreen Advisors CEO David Winters shared his 11-point plan with Coca-Cola's (NYSE:KO) largest owners earlier this month, and makes it available to the public today on FixBigSoda.com.
- Among the items are improving margins ("stuck at 26% for the past three years"), a laser-like focus on costs, an increased pace of bottler refranchising, no more attempts to buy growth, and - of course - suggestions on improving corporate governance.
Wed, Jul. 23, 8:29 AM
- PepsiCo (NYSE:PEP) +2.2% premarket after beating expectations for Q2 earnings and revenues and raising its full-year earnings outlook.
- PEP now sees FY 2014 EPS of ~$4.53, up 8% Y/Y vs. a prior forecast of 7% growth, and reaffirms revenue guidance of growth in the mid-single digits vs. 2013, based on the strength of YTD results and its outlook for the rest of the year; currency translation effects are expected to have a negative impact of ~4% on 2014 EPS growth.
- For Q2, volumes in the beverage and snack categories rose 1% and carbonated soft drink volume in the North American market fell 2%, a day after rival Coca-Cola (NYSE:KO) said its North American soda volumes were flat in the quarter.
- The Americas foods business posted $6.07B in revenue, up less than 1%, as Frito-Lay North America sales rose 1.7%; Latin America foods sales were relatively flat at $2.12B, and Quaker Foods North America sales fell 2.3%.
- Gross margin rose to 54% from 53%; input costs fell 1.5% to $7.78B.
Tue, Jul. 22, 9:58 AM
- Coca-Cola (KO -2.6%) opens sharply lower after Q2 revenues fell Y/Y and finished below expectations as North America sales declined for the second straight quarter.
- Q2 global unit case volume grew 3% Y/Y but was flat in North America, despite increased marketing around the World Cup and the launch of the "Share a Coke" campaign; J.P. Morgan analysts had expected volumes to gain 1%-2% in North America, which accounted for 45% of total Q2 revenue.
- On the bright side, gross margin widened to 61.7% as input costs declined 3.4% from a year earlier.
- KO also says adjusted earnings would be hurt by $0.02 in H2 due to the restructuring of its juice operations in Russia and the separation of its Brazilian bottling operations last year.
Tue, Jul. 22, 7:36 AM
Mon, Jul. 21, 5:30 PM
KO vs. ETF Alternatives
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