Coca-Cola Stock Pops on Earnings Beat

Coca-Cola did see a drop in revenue, however

Deputy Editor
Feb 10, 2021 at 9:45 AM
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Blue-chip name and beverage giant Coca-Cola Co (NYSE:KO) is getting a leg up this morning as investors react to the company's fourth-quarter results. Coca-Cola posted earnings that topped analysts estimates, while its revenue matched expectations. While KO did suffer a year-over-year drop in revenue, due to weak sales in restaurants, movie theaters and stadiums, it did note some improvement through some of the company's cost-cutting efforts, with its CEO projecting a return to "growth in the year ahead." At last check, KO is up 2.2% at $50.80. 

On the charts, KO has yet to recover from last year's pandemic-fueled plummet, with a steady year-long climb on the charts losing steam near the $54 level late last year. And while the security is still suffering a roughly 16% year-over-year deficit, it looks ready to topple several recently resistant trendlines, including the 140-day moving average. 

Analysts are split on the equity, with eight saying "strong buy" and seven calling it a tepid "hold." The 12-month consensus price target of $57.02, meanwhile, is a 12.2% premium to last night's close. 

Options traders have been overwhelmingly bullish ahead of KO's earnings event, however. The equity sports a 50-day call/put volume ratio of 5.2 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which stands higher than all other readings from the past year. This implies calls haven't been more popular during the past 10 weeks. 

Short sellers are hitting the exits as well. In the past two reporting periods, short interest dropped 20%. Now, the 19.95 million shares sold short represent less than 1% of KO's available float, or just over one day at its average daily pace of trading. 

 

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