Coca-Cola's (KO) "solid" Q4 results showed underlying momentum in the company's portfolio, even though they were impacted by temporary mix headwinds and timing factors, RBC Capital Markets said in a note Wednesday.
The firm highlighted a combination of category, geographic and marketing timing effects, each roughly one point, as the main drivers of the mix headwinds.
The brokerage said the results do not change its confidence in Coca-Cola's ability to manage through a challenging global environment. It said the company is still gaining share in many markets, with solid margins and a bias to reinvest to support sustained volume growth.
The pending sale of Coca-Cola Beverages Africa "will be margin accretive and will be the main driver of margin expansion (H2 weighted) for the year," RBC added, alongside pricing, productivity and favorable foreign exchange.
Coca-Cola provided fiscal 2026 guidance for organic sales growth of between 4% and 5%, with earnings per share expected in the range of $3.21 to $3.24. This reflects strong back-half margin performance, partially offset by a higher tax rate.
RBC raised Coca-Cola's price target to $87 from $78 and reiterated the company's outperform rating.
Shares of Coca-Cola were up 2.4% in recent trading.
Price: 78.63, Change: +1.82, Percent Change: +2.36
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