KO stock looks like its consolidating on the chart before the next leg up.
On May 28, 2020, Citi analyst Simon Hales upgraded Coca-Cola European Partners to Buy from Neutral saying consensus estimates underestimate margin pressures in the European Beverages space and overestimates the offset from better off-premise sales and cuts to discretionary spend. The analyst prefers soft drinks to spirits and beer.
On May 11, 2020, Citi analyst Wendy Nicholson downgraded Monster Beverage (MNST) to Neutral from Buy with a price target of $73, down from $77. The analyst views the company’s Q1 results a strong but feels the stock is now close to fully-valued. Nicholson thinks the odds of Coca-Cola (KO) buying more shares of Monster in the near-term are low and that competition in the energy drink category has increased.
On May 5, 2020, Guggenheim analyst Laurent Grandet raised the firm’s price target on Monster Beverage (MNST) to $66 from $60 as he now includes an M&A takeout premium in his valuation given his view that a “strong case” can be made for Coca-Cola (KO) to increase its ownership of Monster following PepsiCo’s (PEP) recently announced acquisition of Rockstar and distribution agreement with Bang Energy. Strategically, the analyst believes Coke would benefit from owning the brand because it would consolidate the entire Monster profit pool and give the company freedom to innovate in the energy space with its own portfolio. Despite a more challenged start to the year due to the COVID-19 outbreak, Grandet sees long-term positives – including access to Coca-Cola’s global distribution system – that help support Monster’s valuation premium, the analyst said. He keeps a Buy rating on Monster shares.
On May 2, 2020, Berkshire Hathaway said in its earnings release that approximately 69% of its aggregate fair value was concentrated in five companies: American Express (AXP) at $13B, Apple at $63.8B, Bank of America (BAC) at $20.2B, Coca-Cola (KO) at $17.7B and Wells Fargo (WFC) at $9.90.