Should You Buy Coca-Cola Stock Ahead Of Its Upcoming Earnings?

Forbes

2 days ago

Photo byCoca-Cola (NYSE:KO) is set to release its earnings on Tuesday, July 22, 2025. Analyzing the past five years, Coca-Cola stock has shown a pattern of positive one-day returns after earnings announcements, occurring in 72% of cases. The median positive return recorded was 1.4%, with a maximum one-day positive return of 4.7%.
For traders focused on events, while the actual results against consensus and expectations are significant, recognizing these historical trends can provide a strategic edge. There are two main strategies worth considering:
Analysts predict Coca-Cola will report earnings of $0.84 per share on revenues of $12.55 billion. This is in comparison to the earnings of $0.84 per share on revenues of $12.31 billion in the same quarter last year.
From a fundamental viewpoint, the company currently has a market capitalization of $298 billion. Over the past twelve months, Coca-Cola generated $47 billion in revenue, recording $14 billion in operating profits and a net income of $11 billion.
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Coca-Cola's Historical Odds Of Positive Post-Earnings Return
Here are some insights regarding one-day (1D) post-earnings returns:
Additional information regarding the observed 5-Day (5D) and 21-Day (21D) returns post earnings is compiled alongside the statistics in the table below.
KO 1D, 5D, and 21D Post Earnings Return
Correlation Between 1D, 5D, and 21D Historical Returns
A generally less risky approach (though it may be ineffective if the correlation is weak) is to analyze the correlation between short-term and medium-term returns after earnings, identify a pair with the highest correlation, and execute the corresponding trade. For instance, if 1D and 5D exhibit the strongest correlation, a trader could go "long" for the next 5 days if the 1D post-earnings return is positive. Below is some correlation data based on 5-year and 3-year (more recent) history. Note that the correlation 1D_5D indicates the correlation between 1D post-earnings returns and the subsequently recorded 5D returns.
KO Correlation Between 1D, 5D and 21D Historical Returns
Is There Any Correlation With Peer Earnings?
At times, the performance of peers can affect the stock reaction following earnings. In fact, the pricing-in can begin prior to the earnings being announced. Below is some historical data regarding the post-earnings performance of Coca-Cola stock compared to the stock performance of peers that reported earnings just before Coca-Cola. For a fair comparison, peer stock returns also reflect post-earnings one-day (1D) returns.
KO Correlation With Peer Earnings
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