Core Insights - Coca-Cola Consolidated, Inc. reported record revenue, gross profit, and operating income for fiscal year 2025, highlighting strong performance and effective execution in the marketplace [4][3] - The company experienced a 4.6% increase in volume for the fourth quarter of 2025 and a 0.3% increase for the fiscal year, with the fourth quarter benefiting from an additional selling day [4][5] - Net sales rose by 9.0% to $1.9 billion in the fourth quarter and by 4.8% to $7.2 billion for the fiscal year, driven by pricing actions and strong volume performance [5][6] Financial Performance - Gross profit for the fourth quarter of 2025 was $754.2 million, an increase of 8.1% compared to the previous year, while gross margin decreased to 39.6% due to rising aluminum costs [8][6] - Income from operations for the fourth quarter was $242.1 million, up 10.7%, and for the fiscal year, it reached $950.7 million, a 3.3% increase [10][6] - Net income for the fourth quarter was $137.3 million, down 23.3% from the previous year, while adjusted net income increased slightly to $157.8 million [11][12] Beverage Sales - Sparkling beverage sales increased by 6.4% in the fourth quarter and 3.5% for the fiscal year, driven by multi-pack sales in large retail channels [7][5] - Still beverage sales saw a 10.0% increase in the fourth quarter and a 6.1% increase for the fiscal year, reflecting strong performance across various brands [5][7] Expenses and Investments - Selling, delivery, and administrative expenses rose by 6.9% in the fourth quarter, primarily due to labor costs and investments in front-line teammates [9][10] - The company invested approximately $312 million in capital expenditures for fiscal year 2025, with expectations of similar investments in fiscal year 2026 [13][12] Cash Flow and Shareholder Returns - Cash flows from operations for fiscal year 2025 were $931.9 million, an increase from $876.4 million in the previous year [13][12] - The company returned approximately $2.7 billion to shareholders through share repurchases and dividends during fiscal year 2025 [13][12]

Financial Data and Key Metrics Changes - The company achieved a comparable earnings per share (EPS) of $3 in 2025, up from approximately $2 in previous years, marking a significant inflection in earnings growth [8][11] - Free cash flow for 2025 was $11.4 billion, an increase of approximately $600 million compared to the previous year [21][22] - The company reported a 7% average organic revenue growth since 2017, exceeding its long-term growth algorithm [8][11] Business Line Data and Key Metrics Changes - North America delivered strong results with volume, revenue, and comparable operating income growth, despite macroeconomic pressures on lower-income consumers [12][56] - The trademark Coca-Cola brand saw retail sales growth of over $60 billion, reinforcing its position as the highest valued food and beverage brand globally [7] - In Latin America, the company leveraged its systems capabilities to navigate external challenges, achieving volume growth despite a complex environment [12][14] Market Data and Key Metrics Changes - In EMEA, the company gained value share and grew volume and revenue, although volume in Europe initially declined before recovering [14] - The Asia Pacific region experienced flat volume growth, with revenue and profit declines attributed to softer consumer spending and weaker industry performance [16] - The company reported volume growth in both operating units in Asia and the Middle East, driven by local consumer insights and impactful marketing campaigns [15][16] Company Strategy and Development Direction - The company aims to increase its number of billion-dollar brands and transform existing brands into multi-billion-dollar brands [17] - Future strategies will focus on better integrating marketing campaigns with commercial execution, improving speed to market, and placing digital at the core of consumer connections [18] - The company is committed to navigating local market dynamics while delivering on global objectives, with a focus on balanced top-line growth and volume as a priority [22][27] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a complex external environment in 2025 but emphasized the company's ability to deliver on guidance and gain value share for 19 consecutive quarters [10][11] - The company expects organic revenue growth of 4%-5% for 2026, with a balanced mix of price and volume anticipated as inflation moderates [22][34] - Management expressed confidence in capturing growth opportunities under new leadership, highlighting the importance of continuous improvement and adaptation [18][27] Other Important Information - The company plans to generate approximately $12.2 billion of free cash flow in 2026, with a commitment to reinvest in the business and grow dividends [24][25] - The anticipated impact of currency fluctuations includes a 1-point tailwind to comparable net revenues and a 3-point tailwind to comparable earnings per share for 2026 [24][61] Q&A Session Summary Question: Insights on 2026 organic sales growth outlook - The company expects a balanced mix of price and volume, with underlying pricing at 4% and volume at 1% for Q4, indicating a strong revenue growth quarter [31][34] Question: General operating conditions and market contributions - Management noted that volume growth is expected to improve in key markets like India and China, while the Mexican tax headwind may impact early 2026 [38][39] Question: North America operating margin sustainability - The North America operating margin has shown structural improvement, with expectations for continued growth driven by effective supply chain management and marketing investments [41][43] Question: Challenges in volatile markets - Management highlighted ongoing strategies to navigate challenges in markets like China and India, emphasizing long-term growth potential despite short-term volatility [50][51] Question: Impact of SNAP changes and Mexican tax - Management views the impact of SNAP changes as manageable and is implementing strategies to mitigate the effects of the Mexican tax while leveraging upcoming events like the World Cup for consumer engagement [66][69]

Financial Data and Key Metrics Changes - The company achieved a comparable earnings per share (EPS) of $3 in 2025, reflecting a significant increase from approximately $2 in previous years, marking a 50% growth [6][19] - Organic revenue growth was reported at 5% for the fourth quarter, with unit case growth at 1% [18][19] - Comparable gross margin and operating margin both increased by approximately 50 basis points, driven by underlying expansion despite currency headwinds [19] Business Line Data and Key Metrics Changes - The company added 12 billion-dollar brands to its portfolio, totaling 32, with 75% of these brands outside the sparkling soft drinks category [5] - Trademark Coca-Cola retail sales grew by over $60 billion, reinforcing its position as the highest valued food and beverage brand globally [5] - North America saw strong results with broad-based strength across its beverage portfolio, including growth in Coca-Cola, Sprite Zero, and BODYARMOR [10] Market Data and Key Metrics Changes - In North America, the company gained both volume and value share, with strong performance across its total beverage portfolio [10] - Latin America experienced challenges but managed to grow volume and revenue, with Coca-Cola Zero Sugar and Sprite Zero Sugar performing well [11] - In EMEA, volume declined initially but recovered, with successful marketing campaigns linked to the holiday season and the Winter Olympics [12] Company Strategy and Development Direction - The company aims to continue expanding its billion-dollar brands and enhance its digital engagement with consumers [15][16] - Future strategies will focus on improving speed to market, better integrating marketing campaigns, and enhancing innovation capabilities [15][16] - The leadership transition to Enrique Braun is expected to bring new energy and focus on brand management and digital engagement [7][8] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a complex external environment in 2025 but expressed confidence in delivering on guidance and maintaining market share [8][9] - The company anticipates organic revenue growth of 4%-5% for 2026, with a balanced mix of volume and price expected as market conditions stabilize [20][21] - Management emphasized the importance of adapting to local market dynamics and leveraging the strength of its brand portfolio for future growth [14][49] Other Important Information - The company generated approximately $11.4 billion in free cash flow in 2025, an increase of about $600 million from the previous year [19][20] - The balance sheet remains strong with a net debt leverage of 1.6 times EBITDA, below the targeted range of 2-2.5 times [20] - The company plans to continue its dividend growth, maintaining a long-standing commitment to returning value to shareholders [24][80] Q&A Session Summary Question: Insights on 2026 organic sales growth outlook - Management indicated that the 4%-5% organic sales growth outlook for 2026 reflects a balance between price, mix, and volume, with expectations for improvement in key markets like India and China [28][36] Question: Impact of macroeconomic conditions on growth - Management acknowledged ongoing macroeconomic pressures but expressed confidence in the company's strategies to navigate these challenges and achieve growth [35][36] Question: North America operating margin sustainability - Management noted that North America has seen structural changes leading to higher operating margins, with expectations for continued improvement and investment in the region [39][41] Question: Currency impact on financial performance - Management explained that the guidance includes a 1% tailwind to net sales and a 3% tailwind to net income due to favorable currency conditions, particularly in emerging markets [60][61] Question: Strategies to address challenges in specific markets - Management highlighted the importance of leveraging successful strategies in stronger markets to offset challenges in regions like China and Mexico, where tax headwinds are anticipated [46][48]

Core Viewpoint - The article discusses five stocks and ETFs that may be attractive to investors seeking defensive positions amid ongoing market volatility, emphasizing sectors that historically perform well during downturns [1][30]. Group 1: Market Conditions - Lingering tariff concerns, a weakening U.S. dollar, and a significant correction in cryptocurrency markets have contributed to risk-off behavior among investors, with Bitcoin falling nearly 40% from last year's highs [2]. - The tech sector has been a major driver of market turbulence, with tech stocks, particularly software, facing challenges due to stretched valuations and heavy capital spending related to AI, leading to a nearly 22% decline in the iShares Expanded Tech-Software Sector ETF (BATS: IGV) year-to-date [3][6]. Group 2: Defensive Sectors and ETFs - Defensive sectors such as healthcare and consumer staples are attracting capital as investors seek stability amid tech-led weakness and rising volatility [6][30]. - The Health Care Select Sector SPDR Fund (NYSEARCA: XLV) is highlighted for its defensive characteristics, offering exposure to essential healthcare services and a 1.6% dividend yield, with strong liquidity and institutional interest [7][9][11]. - The Consumer Staples Select Sector SPDR Fund (NYSEARCA: XLP) provides exposure to companies producing everyday necessities, maintaining stable demand even during recessions, and has surged over 13% year-to-date [17][19]. Group 3: Individual Stocks - Johnson & Johnson (NYSE: JNJ) is noted for its stability, with shares up almost 16% year-to-date and a diversified business model that ensures consistent demand across pharmaceuticals, medical devices, and consumer health products [13][15][16]. - Coca-Cola (NYSE: KO) is recognized for its defensive nature and strong performance, with a dividend yield of approximately 2.6% and a favorable analyst consensus rating, benefiting from consistent consumer demand for its products [20][23][24]. Group 4: Dividend-Focused Strategies - The Vanguard High Dividend Yield ETF (NYSEARCA: VYM) is presented as a strong option for investors seeking diversification and income, yielding 2.25% and outperforming the broader market with an 8% increase year-to-date [25][27][28]. - Dividend-focused strategies, including ETFs and individual stocks like JNJ and KO, are emphasized as effective ways to maintain equity exposure while providing downside protection during market volatility [30].

Core Viewpoint - High-quality, high-yielding dividend stocks such as Chevron, Coca-Cola, and Verizon are ideal for investors seeking sustainable passive income in 2026 [1][16] Group 1: Chevron - Chevron has a dividend yield of approximately 4.5%, significantly higher than the average Dow stock yield of 2% [4] - The company has increased its dividend payment for 38 consecutive years, showcasing its ability to grow dividends through various commodity cycles [4] - Chevron's net debt ratio stands at 15.1%, well below its target range of 20% to 25%, indicating a strong balance sheet [5] - The company expects to generate an additional $12.5 billion in free cash flow in 2026 at an average oil price of $70 per barrel, with a projected annual growth rate of over 10% through 2030 [7] Group 2: Coca-Cola - Coca-Cola's current dividend yield is around 3%, and it has raised its dividend for 63 consecutive years, qualifying it as a Dividend King [8] - The company generates steadily rising revenue and strong cash flows from its diverse beverage brands, supporting its financial goals of 4% to 6% annual organic revenue growth [10] - Coca-Cola has a strong balance sheet, allowing for acquisitions that drive earnings-per-share growth, such as Fairlife and Topo Chico [11] Group 3: Verizon - Verizon boasts the highest yield in the Dow at nearly 7%, with a history of increasing its dividend for 19 years [12] - The telecom giant is projected to produce between $37 billion and $39 billion in operating cash flow, ensuring ample cash to cover its annual dividend payments of about $11.5 billion [14] - Verizon plans to enhance its fiber capabilities through a $20 billion acquisition of Frontier Communications, which is expected to grow revenue and cash flow [15]

Core Viewpoint - Coca-Cola is positioned as a reliable dividend and free cash flow grower for investors in 2026, despite challenges in the consumer packaged goods sector in 2025 [1][2]. Company Performance - Coca-Cola's shares performed well in 2025, making it one of the best consumer defensive stocks amid economic uncertainties [2][4]. - The company is expected to maintain or slightly exceed its performance in 2026 due to its dependable cash flow generation and strong operating margins [5][12]. Macroeconomic Environment - CEO James Quincey indicated that 2026 may present more macroeconomic headwinds, but emphasized the company's focus on controllable factors like execution, innovation, and pricing [7][8]. - Quincey acknowledged the importance of being prudent with pricing strategies, considering consumer sensitivity to rising input costs [8][9]. Financial Strength - Coca-Cola has a strong cash position, with $14 billion in cash and cash equivalents as of the end of Q3, which may have increased following a recent $2.4 billion share sale [12]. - The company's leverage is low, within the desired range of 2x to 2.5x net debt/EBITDA, and it holds an A+ credit rating from S&P Global, allowing access to capital markets at favorable rates [12][13]. Investment Outlook - While Coca-Cola may not deliver explosive growth in 2026, it is seen as a durable and reliable investment option for those seeking stability in their portfolios [13].

Core Viewpoint - Coca-Cola is well-positioned to continue its dividend growth, having increased its dividend for 63 consecutive years, qualifying it as a Dividend King [1][3][12] Company Performance - Coca-Cola has a diverse portfolio with approximately 200 brands sold in over 200 countries, including 30 brands that generate over $1 billion in annual sales [3] - The company has achieved an average organic revenue growth rate of 9% over the past five years, driven by volume growth, price increases, and new product launches [4][10] Financial Strength - Coca-Cola maintains a strong balance sheet with an A+/A1 bond rating, providing significant financial flexibility [7] - The company's leverage ratio is at the low end of its target range of 2.0-2.5 times, allowing for an additional $12.6 billion in debt capacity [8] - Recent transactions, including a $2.4 billion cash infusion from Coca-Cola Consolidated and a $3.4 billion deal involving Coca-Cola Beverage Africa, are expected to enhance its financial position [9] Growth Strategy - Coca-Cola invests over $2 billion annually in capital expenditures to support high-growth areas, aiming for organic revenue growth of 4% to 6% and earnings-per-share growth of 7% to 9% [10][11] - The company plans to continue making acquisitions to supplement its organic growth, leveraging its strong balance sheet for future opportunities [11]

Core Insights - Coca-Cola Consolidated, Inc. reported strong financial performance for the third quarter and first nine months of fiscal 2025, with notable increases in net sales and gross profit [3][4][5]. Financial Performance - In the third quarter of 2025, net sales increased by 6.9% to $1.888 billion, while for the first nine months, net sales rose by 3.3% to $5.324 billion [5][20]. - Gross profit for the third quarter was $748.5 million, reflecting a 7.2% increase compared to the same period in 2024, with a gross margin of 39.6% [5][7]. - Income from operations for the third quarter was $246.6 million, an increase of 8.6% year-over-year, resulting in an operating margin of 13.1% [9][20]. Volume and Sales Breakdown - Total volume in the third quarter increased by 3.3%, while the first nine months saw a decline of 1.2% due to two fewer selling days compared to the previous year [4][26]. - Sparkling beverage sales in the third quarter rose by 4.7%, while still beverage sales increased by 9.9% [6][20]. Earnings and Shareholder Returns - Earnings per share for the third quarter increased by 24% to $1.64, with adjusted earnings per share rising by 10% to $2.06 [5][10]. - The company returned over $211 million to shareholders through share repurchases and dividends during 2025 [4][12]. Cost Management - Selling, delivery, and administrative expenses increased by 6.6% in the third quarter, primarily due to labor costs, but as a percentage of net sales, these expenses decreased to 26.6% [8][20]. - The company effectively managed commodity cost increases through annual price adjustments implemented earlier in the year [7][8]. Cash Flow and Investments - Cash flows from operations for the first nine months of 2025 were $722.9 million, compared to $707.9 million in the same period of 2024 [12][23]. - The company invested approximately $210 million in capital expenditures to optimize its supply chain and support future growth [12][23]. Balance Sheet Highlights - As of September 26, 2025, total assets were $5.669 billion, with stockholders' equity amounting to $1.636 billion [22]. - Current assets increased to $2.848 billion, while total liabilities rose to $4.033 billion [22].

Core Insights - Constitution Capital sold 50,233 shares of The Coca-Cola Company, valued at approximately $3.46 million, reducing its holdings to 57,436 shares worth $3.81 million as of quarter-end [2][3] Company Overview - The Coca-Cola Company has a market capitalization of $294.54 billion and reported revenue of $47.06 billion and net income of $12.18 billion for the trailing twelve months [4] - The company's stock price was $68.44 as of October 17, 2025, reflecting a 2.1% decline over the past year and underperforming the S&P 500 by 14 percentage points [3][4] Business Model - The Coca-Cola Company operates as a global leader in the non-alcoholic beverage industry, with a diverse portfolio that includes sparkling soft drinks, water, sports drinks, coffee, tea, juice, dairy, and plant-based beverages [5][7] - Revenue is primarily generated through the sale of beverage concentrates and syrups to bottling partners, as well as direct sales to retailers and distributors [7] Competitive Position - The company benefits from a resilient business model and consistent profitability, which provide a competitive advantage in the consumer defensive sector [8] - Coca-Cola has maintained a dividend yield of 3% and has increased its dividend payments for 62 consecutive years, making it an attractive option for investors seeking passive income and stability [11] Investment Considerations - Constitution Capital's allocation in Coca-Cola has increased from 0.9% to 1.8% over the last two years, despite recent sales, indicating a mixed investment strategy [9] - The stock is viewed as a potential "buy the dip" candidate, currently down 8% from its high this year, with a price-to-earnings ratio of 24, below its 5-year average of 27 [10]

Core Viewpoint - Coca-Cola has been a leading brand since 1892, serving over 200 countries, but its stock performance has been underwhelming in the past five years, with a more optimistic outlook for the next five years due to growth in non-U.S. markets [1][2] Group 1: Market Performance - The stock has underperformed the market over the last five years, but the next five years show potential for improvement, particularly in emerging markets [2] - Coca-Cola's volume growth is expected to be limited, but revenue growth can be driven by price/mix strategies, which involve increasing prices or selling more premium products [4] Group 2: Regional Insights - Emerging markets like Latin America and the Asia Pacific are experiencing income growth, leading to increased spending on branded products [3] - In the second quarter, Latin America and the Asia Pacific had significantly higher price/mixes of 15 and 10, respectively, compared to North America and Europe, the Middle East, and Africa, which both had a price/mix of 3 [5] Group 3: Investment Considerations - Analysts from The Motley Fool Stock Advisor have identified ten stocks they believe are better investment opportunities than Coca-Cola, suggesting caution for potential investors [6][7] - The historical performance of stocks recommended by The Motley Fool indicates significant potential returns, highlighting the competitive landscape for investment choices [7][8]