Tuesday, 14 April 2015

Expectation From Coca Cola In 2015


What to expect from Coca-Cola in 2015.

The Coca-Cola Co. is a popular name in the beverage industry that is known for its high-end fizzy drinks. The company recently revealed their fourth-quarter sales and earnings that were far more than what Zacks estimated earlier.

The Coca-Cola Co. stocks adjusted earnings for each share was said to be 58 cents that increased by 7.4 per cent on a year over year basis. This was due to the low sales cost and other expenses which the company had to deal with. However, sales of the company experienced a boost of 1.5 percent when considering constant currencies. The volumes of sales improved, but the pricings remained as weak.

The Coca Company which operates with ticker KO has Coca-Cola Enterprise as its bottling partner in the Western European market. So this means the Coca-Cola Enterprise has limited its focus to the Western European market resulting in an exposure to the economic uncertainties that persist within the region.

At this point of time, Coca Cola Company has been dealing with several obstacles in its retail consumer businesses and the highly competitive market that persists in the United Kingdom. However, the odds are currently in their favor since consumer trends show positivity since buyers within the region are known for spending without much worry.

However, the economic softness and operating barriers that persist in the region are going on since a long time. The consumer pattern is constantly changing as well that further ignites competition which has also dented the company’s top line in 2014. The executive leadership at Coca-Cola expects these obstacles to persist in 2015 that can further rupture the growth in the company’s revenues.

Apart from this, the management at Coke expects that a minimal cost of commodities in 2015 whereas previously the benefit were different. The Cost of sales has also reduced by 1 percent when studying the previous year. Moreover another thing that bothers the company is currency translations which can result in massive headwind in 2015 which was also different back then in 2014.

The Euro has also not been doing much good when compared to the performance of the dollar. These currency fluctuations have also resulted in problems for Coca-Cola Enterprises earnings in Q4. Moreover, it is also expected that Fx to be a massive blow in 2015 earnings per share than what the management expected a year back.

This has created immense instability for Coca-Cola Co. stock price in 2015 since conditions were far more in favor of them earlier. Things have changed now and it will be amusing to see how KO fights back.

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