Coca-Cola Set to Report Q3 Earnings: What to Expect

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Coca-Cola is preparing to release its third-quarter earnings report on Wednesday before the market opens. Wall Street analysts surveyed by LSEG are anticipating earnings per share (EPS) of 74 cents and revenue of $11.60 billion.

In recent quarters, Coca-Cola has outperformed its main competitor, PepsiCo. PepsiCo has been dealing with setbacks, including the Quaker foods recall, slowing snack sales, and underperformance in its energy drink segment. In contrast, Coca-Cola has benefited from strong demand in its international markets, which has helped counterbalance weaker demand in the U.S., where consumers have been dining out less. This decline in off-premise sales prompted Coke to partner with restaurant chains to offer combo meal deals, aiming to attract customers back to the brand.

Despite the challenges in the U.S. market, Coca-Cola raised its full-year outlook during the last quarter and expressed confidence in its ability to meet those targets for the second half of the year. For 2024, the company expects organic revenue growth of 9% to 10% and comparable earnings growth in the range of 5% to 6%.

Shares of Coca-Cola have increased by 18% so far this year, bringing the company’s market value close to $300 billion.

Norway’s $1.8 Trillion Wealth Fund Issues Cautionary Stock Market Outlook

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Norges Bank Investment Management (NBIM), which oversees Norway’s $1.8 trillion sovereign wealth fund, has warned of increased stock market risks amid growing global economic uncertainty. As one of the world’s largest investors, NBIM highlighted the potential for downside in equity markets, advising a cautious approach despite its long-term strategy of maintaining a 70% equity and 30% bond portfolio.

Trond Grande, deputy CEO of NBIM, emphasized the need for “realistic” expectations given the fund’s significant growth—its equity portfolio has doubled in value over the past five years. Grande pointed to concerns such as the political climate in the U.S., China’s economic stimulus measures, and stagnant growth in Europe, all of which contribute to a more uncertain outlook.

This warning follows NBIM’s recent third-quarter performance, which saw a 4.4% return, translating to a profit of 835 billion Norwegian kroner ($76.1 billion). While this performance was solid, it slightly underperformed against the fund’s benchmark index. Falling interest rates provided a boost to the stock market, but NBIM remains cautious, noting that the risks ahead may outweigh further gains.

The International Monetary Fund (IMF) recently echoed similar sentiments, stating that while the fight against global inflation is nearly won, downside risks are increasingly prevalent. Analysts, including Cantor Fitzgerald’s Eric Johnston, have also raised concerns about the U.S. economic outlook, with high consumer prices, restrictive Federal Reserve policies, and China’s slowing growth posing challenges over the next few months.

Heineken’s Q3 Revenue Slightly Exceeds Forecasts, Full-Year Guidance Unchanged

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Heineken, the world’s second-largest brewer, reported a 3.3% rise in organic net revenue for the third quarter, narrowly surpassing analysts’ expectations of 3.2% growth. The increase was driven by higher-priced and non-alcoholic beers, with the Heineken brand itself seeing an 8.7% rise in global volumes, particularly strong in Africa, the Middle East, and Asia Pacific. Non-alcoholic beers and ciders also saw growth, up by 11%.

Despite these gains, overall volumes grew just 0.7%, with two of Heineken’s three largest regions experiencing declines. The company has kept its full-year guidance unchanged, targeting 4-8% organic operating profit growth, despite earlier concerns raised by weaker half-year results.

CEO Dolf van den Brink noted that the business is performing in line with expectations, though challenging market conditions persist. Analysts, including Trevor Stirling of Bernstein, emphasized that Heineken is in a rebuilding phase, needing consistent results to regain investor confidence after previous disappointments.

Shares of Heineken were up 2.34% in early trading following the announcement.