Vita Coco Company (COCO) to Post Q2 Earnings: Things to Note

Core Viewpoint - Vita Coco Company, Inc. (COCO) is expected to report growth in both revenue and earnings for the second quarter of 2024, with earnings estimated at 31 cents per share, reflecting a 19.2% increase year-over-year [1][2]. Financial Performance - The consensus estimate for second-quarter revenues is $143.5 million, indicating a 2.7% rise from the previous year [2]. - In the last reported quarter, the company achieved an earnings surprise of 26.3%, with a trailing four-quarter average earnings surprise of 25.3% [2]. Key Factors Influencing Performance - The company's performance is anticipated to benefit from strong brand presence and effective strategic execution, particularly in the coconut water category [3]. - The flagship brand has shown consistent growth, supported by increased volumes in private label coconut water [3]. - Commercial initiatives, including multi-packs and new product lines like Vita Coco Farmers Organic and Vita Coco Juice, are expected to contribute positively to performance [4]. - The focus on expanding consumption occasions for coconut water is likely to enhance both category and brand performance [4]. Challenges - The company faces challenges from a tough macroeconomic environment, including uncertainties in global economies and geopolitical issues [5]. - Rising selling, general, and administrative (SG&A) expenses have been a concern, with management indicating that elevated ocean freight costs may negatively impact gross margins starting in the second quarter [5]. Earnings Prediction Model - The current earnings prediction model does not indicate a strong likelihood of an earnings beat for Vita Coco, with an Earnings ESP of -3.85% and a Zacks Rank of 3 [6].