Previous guidance from the company indicated growth of 5% to 6%.
“Our leading portfolio of brands, coupled with an aligned and motivated system, positions us to win in the marketplace today while also laying the groundwork for the long term,” Quincey said.
Although most economists have stopped predicting an imminent recession, citing surprisingly strong growth, there is still worry that the buying power of many American households is being eaten away by inflation and higher interest rates.
For Coke-watchers, the revised, more optimistic guidance is welcome news.
“It’s a good sign, given all the consternation about the consumer being under more pressure,” said Duane Stanford, editor and publisher of Beverage Digest.
There’s still uncertainty that could threaten the optimism, Stanford said. “The question ahead is how much more economic pressure is in store for consumers and, most importantly, how will they react?”
Coke has dramatically broadened its portfolio in recent years, from Barq’s Root Beer to Smartwater to a Jack Daniels “canned cocktail.”
Coke’s strategy is to be “the one category consumers don’t cut back on at the store as household budgets tighten,” Stanford said. “Outside of marketing, Coke’s retail and packaging strategies have to make purchases of its products as painless as possible for consumers.”
After the morning’s release, Coca-Cola stock bubbled up 2%, although by mid-afternoon it had lost some of that fizz. In mid-afternoon, Coke stock was trading at $55.47 a share, up $1.41 a share.
Shares of Coca-Cola, which had fallen 18% between early May and October, have been slowly climbing since hitting a year-long low of $52.38 earlier this month.
Those shares are positioned to hit $68 within the next year, higher than its all-time crest of $65.72 a share in 2022, said Garrett Nelson, senior equity analyst at CFRA Research.
He upgraded his view on Coke from a “buy” to a “strong buy,” partly on the strength of its international appeal. “Latin American growth was particularly strong,” Nelson said.