By Peet Serfontein & Khumbulani Kunene
We enter a long position with a target price of $80.00 and a stop-loss of $67.00
The Coca-Cola Company is the largest non-alcoholic beverage product owner and one of the most recognisable consumer brands in the world
The company is home to numerous beverage brands, including five of the world's top six non-alcoholic sparkling soft drink brands: Coca-Cola, Sprite, Fanta, Coca-Cola Zero Sugar, and Diet Coke/Coca-Cola Light. Its portfolio also includes certain water brands, juices, coffees and teas, and energy drinks. The company reaches consumers in more than 200 countries.
Technically, an upward-sloping expected price path across all forecast horizons, and upside outcomes dominating the confidence bands, signals a potential investment opportunity for the stock (see the insert on the main chart). This pattern highlights an AI forecasting model that applies a Gradient Boosting framework to seven years of adjusted price data, incorporating trend, momentum, volatility and cycle-based technical features to project probabilistic price paths with 80% confidence bands.
A developing pattern of higher highs and higher lows with consistently low volatility also supports a bullish case for the stock (see notation on the main chart). This structure indicates sustained buying interest and disciplined accumulation, supporting a bullish stance. Demand stepping in on pullbacks has progressively lifted both support and resistance levels, underpinning the uptrend
Upside price momentum according to the Moving Average Convergence Divergence (MACD), and the recent upward trajectory of the on-balance volume (OBV) indicator, also supports our bullish view.
This trade can also be mirrored utilising the JSE listed FNB ETN COETNQ (without currency exposure) and COETNC (with currency exposure).
| Share Information | |
|---|---|
| Share Code | KO |
| Industry | Food, Beverage & Tobacco |
| Market Capital (USD) | 306.45 |
| One Year Total Return | 18.24% |
| Return Year-to-Date | 1.90% |
| Current Price (USD) | 71.24 |
| 52 Week High (USD) | 74.38 |
| 52 Week Low (USD) | 61.30 |
| Financial Year End | December |
| The price is testing its 200-day simple moving average (SMA) which also supports a bull case for the stock | |
| Consensus Expectations (Bloomberg) | ||||
|---|---|---|---|---|
| FY24 | FY25E | FY26E | FY27E | |
| Headline Earnings per Share (USD) | 2.88 | 2.99 | 3.22 | 3.44 |
| Growth (%) | 3.82 | 7.76 | 6.64 | |
| Dividend Per Share (USD) | 1.94 | 2.03 | 2.13 | 2.24 |
| Growth (%) | 4.79 | 4.57 | 5.17 | |
| Forward PE (times) | 23.83 | 22.12 | 20.74 | |
| Forward Dividend Yield (%) | 2.85 | 2.98 | 3.14 | |
| The company is set to deliver positive consistent earnings growth over the medium term. | ||||
Buy/Sell Rationale:
Technical Analysis:
Long term fundamental view:
| Share Name and Position | CEG - Stop loss (Close the position) | SETN - Stop loss (Close the position) | PRU - Take profit (Close the position) |
|---|---|---|---|
| Entry | 354.11 | 334.86 | 105.04 |
| Current | 322.54 | 317.80 | 117.05 |
| Movement | -8.9% | -5.1% | +11.4% |
| The stock hit our stop-loss level, prompting us to close the position. | The stock hit our stop-loss level, prompting us to close the position | The stock has reached our profit target, prompting us to close the position. |
| Share Name and Position | ARKK - Buy (Continue to hold) | BKNG - Buy (Continue to hold) |
|---|---|---|
| Entry | 178.22 | 5 195.76 |
| Current | 83.21 | 5 314.71 |
| Movement | +6.4% | +2.3% |
| A developing broadening-bottom pattern in the price remains of interest. Remains above its 200-day simple moving average. Fading downside price momentum is supportive. Our profit target is $98.00 with a trailing stop-loss at $74.00. | A developing inclining channel pattern remains of interest. Remains just above its 200-day simple moving average. Upside price momentum has halted, which is a concern. Our profit target is $6 200.00 with a trailing stop-loss at $4 800.00. |
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