Coca-Cola, Molson Coors Turn Lemons Into Hard Lemonade

Both stocks are slipping today

Digital Content Manager
Jan 25, 2022 at 12:56 PM
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Coca-Cola Co (NYSE:KO) is once again making a move into the harder stuff, as the soft drink giant partners with Molson Coors Beverage Co (NYSE:TAP) to make a spiked lemonade under its Simply brand. This will be Coca-Cola's third boozy offering, joining its Topo Chico Hard Seltzer and its Fresca canned cocktail. The Simply Spiked Lemonade variety pack will hit stores this summer. 

Both stocks are sporting muted midday losses, with KO last seen down 1.5% to trade at $59.10, while TAP was off 1.2% at last check. Since hitting a series of record highs earlier this month, Coca-Cola stock has gone by way of the broader market, yesterday touching a three-week low of $58.57. The security is eyeing its fourth-daily drop today, but still sports a 21.7% year-over-year lead. 

TAP has also succumbed to Wall Street's recent stumble, selling off after a long-time ceiling at the $52 level rejected its late-December to mid-January rally. However, it's still sporting a 6.4% year-to-date win, thanks to support at its 320-day moving average.

Analyst sentiment surrounding both names has been lukewarm. Just two of the eight analysts covering TAP call it a "strong buy," while the 12-month consensus price target of $54.32 is a 10.1% premium to current levels. The brokerage bunch has taken a sunnier stance on KO, though four of the 13 in coverage consider it a "hold." 

While calls are still king in the options pits for Coca-Cola and Molson Coors, these traders have seen a bearish shift. Molson Coors stock's 50-day put/call volume ratio at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) that sits in the 90th percentile of its 12-month range, while KO's 10-day put/call volume ratio at the ISE, CBOE, PHLX stands higher than 97% of its annual readings. This implies that puts are getting picked up at a quicker-than-usual clip. 

 

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