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Yahoo
23-06-2025
- Business
- Yahoo
Coca-Cola vs. Monster: Which Stock is Positioned for the Top Spot?
As the non-alcoholic beverage industry undergoes a transformation driven by evolving consumer preferences and functional trends, The Coca-Cola Company KO and Monster Beverage Corp. MNST emerge as the key players vying for global market dominance. With its diversified portfolio spanning carbonated soft drinks, water, juice and sports beverages, Coca-Cola holds a commanding position, with a global market share exceeding 40% in the CSD category. Meanwhile, MNST is a category specialist, owning nearly 30% of the global energy drink market, one of the fastest-growing beverage strength lies in its broad reach, iconic brand equity and scale-driven efficiency, while Monster's focused portfolio and marketing edge offer agility and high-margin growth. Despite the strategic partnership between KO and MNST, wherein KO holds a 19% stake in MNST, the two companies increasingly compete for consumer attention across overlapping beverage Coca-Cola continues to pivot toward health-conscious and functional offerings, and Monster pushes international growth and product innovation, the question for investors is clear: Which company is better positioned to capture incremental growth and defend its market position in a shifting landscape? Coca-Cola continues to dominate the global non-alcoholic beverage landscape, holding a top-tier market share across sparkling, still and functional categories. With operations in more than 200 countries and a portfolio of 30 billion-dollar brands, KO continues to win value share across key channels, at home and away from home, and categories ranging from carbonated soft drinks to dairy and first-quarter 2025, the company delivered 6% organic revenue growth and 2% unit case growth, while expanding gross and operating margins, reflecting both pricing strength and underlying demand. Coca-Cola's global beverage strategy is deeply consumer-centric, offering a diverse mix of premium and value offerings, with nearly one-third of its volume now coming from low or no-calorie beverages. Its expansive distribution network and local-first approach help cement its leadership position, even in emerging markets with geopolitical tension or inflationary strength lies in its all-weather business model, a mix of granular market execution, digital agility and portfolio evolution. Through platforms like Studio X and connected packaging, KO is doubling down on personalized digital engagement, while campaigns like "Share a Coke" are being reimagined for Gen Z with enhanced customization and real-time analytics. The company has ramped up innovation in functional and wellness categories, introducing offerings like Coca-Cola Orange Cream and Simply Pop prebiotic is also leaning on local relevance, both culturally and operationally, to deepen trust, particularly in regions like Mexico, India and China. In first-quarter 2025, Coca-Cola added 350,000 outlets and 100,000 digital customers in India alone. As a part of its efforts to improve local and cultural relevance, Coca-Cola India is actively participating in Ratha Yatra 2025 with special-edition Kinley packs, festive activations and wide beverage access. It is empowering local vendors through hydration carts and affordable packs. The PET Bottle-Free Yatra initiative highlights its commitment to sustainability and community as tariff dynamics and global trade tensions introduce cost uncertainties, Coca-Cola's asset-light franchise model and local sourcing practices act as natural buffers. Exposure to tariff-sensitive inputs like aluminum or orange juice remains relatively small, and hedging positions offer further cost acknowledged a manageable impact of tariffs in its guidance, maintaining confidence in 2025 EPS growth of 2-3% and organic revenue growth of 5-6%. With a strong balance sheet, expanding margins and an agile, tech-augmented marketing engine, Coca-Cola is not just defending its market share; it is setting the stage for sustained, long-term growth in a rapidly evolving beverage landscape. Monster continues to solidify its dominance in the global energy drink market, a high-growth, high-margin niche of the non-alcoholic beverage industry. In first-quarter 2025, the company reported a 5.1% increase in operating income and a 10.2% rise in adjusted EPS (excluding alcohol brands) despite FX pressures and macro headwinds. Monster's flagship segment, Monster Energy Drinks, posted 2.2% growth on a foreign-currency-adjusted basis, while international sales now account for 40% of total revenues. The gross margin expanded to 56.5%, driven by pricing actions and supply-chain optimization, reinforcing MNST's strong operational market leadership in several countries and rising per capita energy drink consumption globally, Monster stands well-positioned in a segment that continues to outpace traditional soft drinks. The company's strategy is laser-focused on innovation, affordability and demographic reach. Monster's ever-expanding product suite, spanning core Monster Energy, Reign Total Body Fuel, Reign Storm, Bang Energy and affordable brands like Predator and Fury, targets athletes, gamers, wellness-seekers and price-sensitive consumers across developed and emerging markets. Monster's Ultra Blue Hawaiian has already emerged as a breakout hit in the United States this MNST is aggressively launching SKUs, tapping local market insights and deepening its retail penetration through Coca-Cola's bottling and distribution network. Despite short-term drag from its Alcohol Brands segment, the company remains committed to optimizing that portfolio while fueling its energy drink acknowledges tariff risks and regulatory scrutiny, but its nimble supply chain and strong distributor relationships offer resilience. While trade dynamics and foreign exchange volatility have weighed on reported revenues, Monster's ability to adapt through pricing, cost control and geographic expansion has helped protect ample cash on hand, no outstanding revolver debt and $500 million authorized for share repurchases, MNST remains a financially robust growth stock. As energy drink demand accelerates and global beverage giants chase relevance in the segment, Monster's brand equity, innovation engine and strategic alignment with Coca-Cola make it a compelling long-term play for investors seeking growth and profitability in a maturing beverage landscape. The Zacks Consensus Estimate for Coca-Cola's 2025 sales and EPS implies year-over-year growth of 2.5% and 3.1%, respectively. The EPS estimates have moved up by a penny in the past 30 days. Image Source: Zacks Investment Research The Zacks Consensus Estimate for Monster's 2025 sales and EPS suggests year-over-year growth of 5.8% and 14.8%, respectively. EPS estimates have been unchanged in the past 30 days. Image Source: Zacks Investment Research Coca-Cola currently trades at a forward 12-month P/E ratio of 22.34X, which is above the Zacks Beverages - Soft drinks industry average of 18.23X. However, KO trades at a lower multiple than that of MNST's 32.14X, making it the more value-oriented pick among the two. Image Source: Zacks Investment Research Despite KO being the more value-oriented option based on valuation alone, investors pay up for MNST because it consistently delivers stronger returns. In the past year, Monster's stock has rallied 27.5%, outperforming KO's growth of 7.6% and the broader industry's decline of 1.4%. While KO offers a lower valuation, Monster's stronger stock performance and solid growth trajectory give it the edge. Image Source: Zacks Investment Research Both Coca-Cola and Monster showcase powerful brands and resilient business models, but Monster moves ahead in the eyes of growth-oriented investors. While Coca-Cola offers stability, scale and an unmatched global portfolio, Monster stands out for its category dominance and sharper growth trajectory in the booming energy drink market. Backed by a focused product strategy, deep distribution ties with Coca-Cola and relentless innovation, Monster has delivered a stronger one-year return, reflecting market confidence in its ability to outperform even amid macro truly sets Monster apart is its valuation premium, a testament to its consistent margin strength, capital efficiency and the market's belief in its long runway for expansion. Monster commands investor attention with its growth-centric narrative. For those seeking a beverage stock with momentum, market share gains and scalable innovation, Monster is the more compelling bet in this matchup. Both KO and MNST carry a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report CocaCola Company (The) (KO) : Free Stock Analysis Report Monster Beverage Corporation (MNST) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Business Times
29-04-2025
- Business
- Business Times
Coca-Cola results beat estimates on price hikes, demand surge
[ATLANTA] Coca-Cola on Tuesday (Apr 29) reported better-than-expected revenue and profit for the first quarter, as the beverage giant benefits from price hikes and enjoys strong demand for its sodas, juices and milk offering Fairlife. The Sprite and Fanta maker also maintained its full-year organic revenue and comparable profit forecasts, unlike PepsiCo and Procter & Gamble that lowered their annual expectations as the global trade war triggered by steep US tariffs threatened to push up costs for American companies. '(Coca-Cola's) operations are primarily local, however, it is subject to global trade dynamics which may impact certain components of the company's cost structure across its markets,' it said in a statement. 'At this time, the company expects the impact to be manageable.' In the last quarter, Coca-Cola had underlined strategies to offer affordable packaging options and plans to use plastic bottles to mitigate the impact from 25 per cent tariffs on aluminum imports. 'This morning's print reaffirms our confidence in Coca-Cola's fundamentals despite a difficult macroeconomic backdrop,' RBC Capital analyst Nik Modi said. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up 'Coca-Cola reiterated top- and bottom-line guidance, which should be viewed as favourable in this environment,' he said. Shares of Coca-Cola rose 1.2 per cent in premarket trading. Rival PepsiCo last week called out subdued consumer spending, but demand for Coca-Cola's slightly pricey products has so far remained stable, helping boost sales growth despite price hikes in highly inflationary markets such as Argentina and Latin America. Its first-quarter overall average selling prices rose 5 per cent, while unit case volumes increased 2 per cent. Still, volumes in its North America market fell 3 per cent, mostly due to a slowdown in demand for its legacy brands such as Coca-Cola and Sprite, as well as coffee. In an attempt to boost demand in the region, the company has been betting on its portfolio of energy drinks and prebiotic sodas by launching new items such as Simply Pop. Its quarterly revenue fell marginally to US$11.22 billion, compared with expectations of a 0.84 per cent fall to US$11.14 billion, according to data compiled by LSEG. Excluding items, the company earned 73 US cents per share, compared with estimates of 71 US cents. REUTERS
Globe and Mail
10-04-2025
- Business
- Globe and Mail
3 Safe Stocks to Buy as the Market Moves from 1 Extreme to Another
Wall Street is in turmoil. President Donald Trump announced 'reciprocal' tariffs on U.S. trading partners on April 2, raising investor panic and leading analysts at JPMorgan and Goldman Sachs to raise their recession odds forecasts for 2025. Major stock benchmarks entered correction territory, with popular tech names selling off violently. Then, Trump announced a 90-day pause on tariffs for all trading partners except China. The stock market soared, with the S&P 500 Index ($SPX) closing up nearly 10% on Wednesday, April 9. In turbulent times like these, the consumer staples sector can act as a bulwark for an investor's portfolio. These companies experience consistent demand, steady cash flows, and have navigated business for decades or more. No matter what happens next, these three safe stocks are worth a close look here. Safe Stock #1: Coca-Cola Warren Buffett has long been a fan of Coca-Cola (KO), making KO a great safe stock for investor portfolios. Coca-Cola is now synonymous with refreshing beverages worldwide. Commanding a market cap of about $294 billion, KO stock is up almost 12.5% on a year-to-date basis. Coca-Cola is also a member of the coveted 'Dividend King' club, having raised its dividends consecutively for 50 years or more. Currently, the stock offers a dividend yield of 2.9%. Coca-Cola has consistently outperformed the market in terms of earnings in recent years with the results of its latest quarter being no exception. In Q4 2024, net revenues rose by 6% from the previous year to $11.5 billion with EPS growing by an even sharper 12.2% to $0.55. Remarkably, this marked the 15th consecutive quarter of earnings beats from the company. Coca-Cola's global infrastructure continues to give it a powerful edge as it looks to deepen its presence in emerging markets. With an extensive bottling system — nearly 200 partners worldwide — and daily consumption of its beverages reaching 2.2 billion servings, the company is well positioned to capture growing demand in developing economies where brand familiarity and distribution scale remain critical competitive advantages. Meanwhile, Coca-Cola is actively realigning its offerings and engagement models to better resonate with Gen Z consumers. One of the more strategic developments has been the introduction of a digitally driven ecosystem rolled out in 2023, crafted specifically to target the preferences and consumption habits of younger audiences. Supporting this effort is the expansion of its product lineup to include Simply Pop, a new prebiotic beverage that builds on the broader wellness trend among this demographic. Its sparkling water brand, Topo Chico, also continues to gain traction. Thus, analysts have deemed the stock a 'Strong Buy' with a mean target price of $76.86 which indicates upside potential of about 10% from current levels. Out of 22 analysts covering the stock, 20 have a 'Strong Buy' rating, one has a 'Moderate Buy' rating, and one has a 'Hold' rating. Safe Stock #2: Keurig Dr Pepper Moving from one beverage giant to another, Keurig Dr Pepper (KDP) was formed in 2018 through the merger between Keurig Green Mountain and the Dr Pepper Snapple Group. The beverage conglomerate has a strong presence in coffee, soft drinks, water, juice, and mixers, operating across hot and cold beverage categories with leading brands like Dr Pepper, 7UP, Snapple and Mott's in its portfolio. Valued at a market cap of $45.6 billion, KDP stock is up 8% on a YTD basis. Notably, the stock offers a dividend yield of 2.65%. The most recent quarter saw the company reporting a beat on both revenue and earnings. Net sales of $4.1 billion represented yearly growth of 5.2% while adjusted earnings saw 5.5% growth in the same period to $0.58, coming in ahead of consensus estimates. Overall, KDP's EPS have exceeded Street expectations in seven out of the past eight quarters. Keurig Dr Pepper is steadily transforming into a serious contender in the energy drinks space — a segment where it had virtually no presence until a few years ago. Central to this momentum is its acquisition of GHOST, a youth-driven energy drink brand that has struck a chord with Gen Z consumers. Beyond energy drinks, KDP continues to reinforce its dominance in more established beverage segments. The company's coffee platform, especially in the single-serve pod market, remains the largest in the U.S., thanks in large part to successful brand tie-ups with widely recognized players such as Starbucks (SBUX) and Dunkin'. On the soda front, Dr Pepper has climbed to second place among cola-style beverages in the U.S., capturing 8.3% of the market. Considering these factors, analysts have assigned a rating of 'Moderate Buy' for the stock with a mean target price of $38.39. This indicates upside potential of roughly 11% from current levels. Out of 17 analysts covering the stock, 10 have a 'Strong Buy' rating, one has a 'Moderate Buy,' rating and six have a 'Hold' rating. Safe Stock #3: Procter & Gamble Procter & Gamble (PG), or P&G, specializes in a wide range of personal and consumer health and hygiene products. The company's market cap currently stands at about $371 billion. PG stock is down 3.2% on a YTD basis while offering a dividend yield of 2.48%. PG is also a member of the storied 'Dividend King' club. P&G's results for the most recent quarter were impressive, with both revenue and earnings surpassing estimates. Net sales of $21.9 billion denoted yearly growth of 2% while EPS clocked growth of 2% from the year-ago period to $1.88. Impressively, this was the 10th consecutive quarter of earnings beats from the company. Notably, P&G shows strong physical expansion and AI integration, indicating long-term growth potential. On the technology front, P&G is quietly reshaping its advertising strategy by incorporating artificial intelligence. Leveraging a proprietary system known as AI Studios, the company draws upon decades of internal ad testing data to forecast the likely performance of new campaigns. This enables rapid simulation and analysis, allowing creative concepts to be evaluated in a matter of hours rather than over several weeks. The acceleration of this testing cycle has not only trimmed costs significantly but also compressed the time required for rolling out fresh marketing initiatives, enhancing agility and efficiency across its brand portfolio. Keeping this in mind, analysts have assigned a rating of 'Moderate Buy' for the stock with a mean target price of $181.88, which indicates upside potential of about 16% from current levels. Out of 27 analysts covering the stock, 16 have a 'Strong Buy' rating, two have a 'Moderate Buy' rating, and nine have a 'Hold' rating.
Axios
01-04-2025
- Business
- Axios
PepsiCo agrees to buy soda upstart brand Poppi for nearly $2B
PepsiCo has agreed to acquire prebiotic soda brand Poppi for $1.95 billion, the beverage and snack giant announced Monday morning. Why it matters: The spigot for beverage deals is opening following an agreement by Celsius to acquire Alani Nu for $1.8 billion. Zoom in: PepsiCo is striking the deal after reportedly deciding that a prebiotic soda brand it developed in-house would not succeed, per Bloomberg. The purchase price includes $300 million of cash tax benefits and an additional earn-out. The transaction is also a win for investor CAVU Consumer Partners. Catch up quick: Coca-Cola was in talks to buy Poppi last year but decided to launch its version, Simply Pop.
Express Tribune
18-03-2025
- Business
- Express Tribune
PepsiCo buys Poppi for $1.95B to gain foothold in functional drinks
Listen to article PepsiCo (PEP.O) announced its acquisition of Poppi, a prebiotic soda brand, for $1.95 billion, as the company seeks to strengthen its position in the growing "healthier soda" category. The deal comes as PepsiCo faces declining demand for its traditional sodas and snack products. Following the announcement, PepsiCo's shares rose 1.6% in early trading. The move signals PepsiCo's strategic push into the health-conscious beverage market, a segment where young consumers are increasingly favoring functional drinks over conventional sodas. Healthier beverages on the rise Consumers, particularly young Americans, are turning to healthier sodas and energy drinks, driving beverage giants to innovate. Rival Coca-Cola (KO.N) has expanded its Simply brand to introduce a prebiotic soda called "Simply Pop". Other players, including Celsius Holdings (CELH.O) and Keurig Dr Pepper (KDP.O), have also made investments in the wellness drinks market. PepsiCo's acquisition of Poppi is aimed at bolstering its presence in the prebiotic soda market, a subcategory of carbonated soft drinks (CSD) that is experiencing rapid growth. Prebiotic sodas contain beneficial ingredients that support gut health, an emerging consumer trend. The Poppi advantage Poppi, an Austin, Texas-based brand, has gained traction in recent years. The company reported a 122% increase in retail sales in the 12 weeks leading up to February 22, now holding about 1% of the total US carbonated soft drinks market, according to BNP Paribas. PepsiCo emphasized that Poppi's formulation—a mix of prebiotics, fruit juice, and apple cider vinegar—makes it a low-calorie soda with no more than five grams of sugar per serving. J.P. Morgan analyst Andrea Teixeira noted that the deal would help PepsiCo strengthen its CSD portfolio, which has lost market share to Coca-Cola and Keurig Dr Pepper in recent years. Poppi's journey: from Shark Tank to PepsiCo Founded by Stephen and Allison Ellsworth, Poppi was originally known as Mother Beverage before its rebranding in 2020. The couple pitched their soda on Shark Tank in 2018, securing the backing of investor Rohan Oza, co-founder of CAVU Consumer Partners. Oza played a key role in rebranding Poppi, giving it its signature brightly colored, fruit-forward cans, and expanding its retail presence. 'We're beyond thrilled to be partnering with PepsiCo so that even more consumers across America, and the world, can enjoy Poppi,' said Rohan Oza. Financial terms of the deal PepsiCo disclosed that the $1.95 billion acquisition includes $300 million in anticipated cash tax benefits, bringing the net purchase price to $1.65 billion. The company did not reveal additional financial details of the agreement. Allison Ellsworth: excited for the next chapter Poppi's co-founder Allison Ellsworth expressed enthusiasm about the deal, highlighting that PepsiCo's global distribution would help expand Poppi's reach. 'We can't wait to begin this next chapter with PepsiCo to bring our soda to more people – and I know they will honor what makes Poppi so special while supporting our next phase of growth and innovation,' she said. Ellsworth first developed Poppi in 2015 in her kitchen as a healthier soda alternative. She experimented with fruit juices, apple cider vinegar, sparkling water, and prebiotics, selling her creations at local farmer's markets before gaining national recognition. Legal challenges: class-action lawsuit settlement Despite Poppi's rapid success, the company has faced legal challenges. Last summer, multiple class-action lawsuits were filed against the brand, alleging that its products did not provide the gut health benefits promised in marketing materials. Poppi denied the allegations but agreed to remove references to 'gut health' from its packaging in late 2023. According to a court filing last week, Poppi has agreed to an $8.9 million settlement fund for affected consumers. A hearing on the settlement is scheduled for May 8. PepsiCo strengthens functional beverage portfolio The acquisition of Poppi aligns with PepsiCo's broader strategy to diversify its product offerings beyond traditional sodas. As rising prices continue to impact demand for Pepsi sodas and Lay's snacks, the company is investing in fast-growing health and wellness segments. With consumers shifting toward functional beverages, PepsiCo is positioning itself to compete with emerging brands and long-standing rivals like Coca-Cola.
