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Coca-Cola (KO) Gains But Lags Market: What You Should Know

In the latest trading session, Coca-Cola (KO) closed at $61.32, marking a +1.12% move from the previous day. The stock lagged the S&P 500's daily gain of 1.46%. Meanwhile, the Dow gained 1.09%, and the Nasdaq, a tech-heavy index, added 6.63%.

Coming into today, shares of the world's largest beverage maker had lost 4.67% in the past month. In that same time, the Consumer Staples sector lost 1.72%, while the S&P 500 gained 4.75%.

Investors will be hoping for strength from Coca-Cola as it approaches its next earnings release, which is expected to be February 14, 2023. The company is expected to report EPS of $0.45, unchanged from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $9.97 billion, up 5.3% from the year-ago period.

Investors might also notice recent changes to analyst estimates for Coca-Cola. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.83% higher. Coca-Cola is currently a Zacks Rank #2 (Buy).

Investors should also note Coca-Cola's current valuation metrics, including its Forward P/E ratio of 23.79. This valuation marks a premium compared to its industry's average Forward P/E of 23.57.

Also, we should mention that KO has a PEG ratio of 3.82. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Beverages - Soft drinks stocks are, on average, holding a PEG ratio of 2.87 based on yesterday's closing prices.

The Beverages - Soft drinks industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 40, putting it in the top 16% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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