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23/7/2004 00:24
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localyokel
N° messaggi: 55 -
Iscritto da: 04/3/2004
Nop. Classic Coke still has that caramel smack.
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23/7/2004 17:05
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tycoontony
N° messaggi: 514 -
Iscritto da: 17/3/2004
Shares of Coca-Cola fell 7 percent in early trading Friday
as worries over slack volume and slowing growth outweighed a 16 percent jump in
second-quarter profit.
Coca-Cola was off $3.47 at $45.50 early Friday after scarping as low as $44.11
out of the gate.
On Thursday, the company reported profits of $1.6 billion, or 65 cents a share,
up 16 percent and slightly ahead of the 63-cent average estimate of analysts
polled by Thomson First Call. But revenue came in a bit below expectations,
volume was soft and the company said that it faces "challenging" conditions in
some key markets.
Marc Greenberg of Deutsche Bank downgraded the Atlanta-based company's shares
from "buy" to "hold" and wrote in a note to investors that the company's "value
strategy [is] out of balance."
Fewer shipping days in the second half "will unwind some of the [first half]
profit benefit," Greenberg noted. "This is not a new fact, but the lack of
volume momentum suggests the de-leveraging `hit` on the [earnings before
interest and taxes] could be more negative than expected."
In addition, Coca-Cola is apt to up its marketing and other spending, which will
also weigh on its results going forward, he said.
The "bar [is] coming down," he continued as the "incoming CEO comments suggest
target growth rates may be headed lower. Sustainable, consistent profit growth
beyond 7 percent may be challenging."
Marc Cohen of Goldman Sachs kept his rating at "outperform" but wrote Friday
that the second quarter results were "below our estimate and of low quality."
The company is "taking remedial actions in some trouble markets, which we
believe could dampen profit growth in [the second half]."
"This does not reflect a change in our belief that 9 percent to 10 percent
[earnings] growth is attainable on an ongoing basis, but rather that new
management could prolong the 'transition' the company has been making over the
past few years and reinvest against growing the top-line."
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