Shares of Coca-Cola Co (KO, Financial) moved up 0.47% to $51.46 in premarket trading on Tuesday after the U.S. multinational corporation beat forecasters by 2 cents on second quarter non-GAAP earnings of 63 cents. The earnings result was 3.3% increase from the prior-year quarter.
GAAP earnings increased nearly 12% to 61 cents per share. Revenue grew 12% to $10 billion, beating forecasters by $10 million. The revenue improvement was attributed to significant growth in concentrate sales, and price and mix.
The Atlanta-based beverage giant also recorded a 50 basis-point jump in operating margin to 29.9%. Year to date, it had a 68% increase in operating cash flow to $4.5 billion and strong 87% growth in free cash flow to $3.7 billion.
For full 2019, Coca-Cola targeted 5% growth in organic sales and earnings per share change within a loss of 1% to gain of 1%, giving a range of $2.06 to $2.10 versus $2.08 in full 2018. Consensus estimates are for $2.10. The company also plans to allocate approximately $2.4 billion to capital expenditures.
Shares of Coca-Cola Co. closed Monday at $51.2 for a market capitalization of $218.51 billion. The share price rose 8% so far this year to above the 100- and 50-day simple moving average lines. Despite the significant upside, the share price is still below the 20-day simple moving average line.
The closing price Monday was 15.7% above the 52-week low of $44.25 and 2.5% below the 52-week high of $52.47. The 14-day relative strength index is 45.43.
Wall Street predicts the stock will outperform the S&P 500 index within 52 weeks and has given it an average target price of $52.90 per share.
On Oct. 1, the company will pay a cash quarterly dividend per share of 40 cents cash to shareholders of record Sept. 16, in line with its previous distribution. The payment, which will be the third one this year, represents a 2.56% hike year-over-year. The ex-dividend date is scheduled for Sept. 13. The quarterly dividend produces a forward dividend yield of 3.11% versus the industry median of 2.17% and versus the S&P 500 index’s dividend yield of 1.88%. Yields are as of July 22.
Disclosure: I have no positions in any security mentioned.
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