S&P Equity Research Picks KO Focus Stock of the Week
NEW YORK, Nov. 15, 2010 /PRNewswire/ -- The Coca-Cola Co. (KO: $63) has been picked by Standard & Poor's Equity Research as its Focus Stock of the Week. KO carries S&P's highest investment recommendation of 5-STARS, or Strong Buy.
"With KO's presence in more than 200 countries, we like its international footprint, and we estimate emerging markets will account for over 20% of total company revenues in 2011," said Esther Kwon, Beverages Equity Analyst at Standard & Poor's Equity Research. "We also believe opportunities to increase per capita consumption remain extremely strong. According to data from the company, U.S. per capita consumption of KO's brands is approximately 400 servings per year, which we estimate is declining at an annual low-single digit rate. However, volume in countries with per capita consumption below 150 servings grew at a 10% rate year-to-date through the third quarter of 2010."
Kwon thinks KO's global infrastructure positions it well to grow its multiple brands spanning both carbonated and non-carbonated beverages. She observes that the company licenses and markets more than 500 different brands. "In 1997, it had only five brands exceeding $1 billion at retail," Kwon said. "In 2010, that number has grown to 13, and we expect more brands to join that group as KO expands distribution of its newer portfolio of brands into new countries."
To view a video of Ms. Kwon discussing The Coca-Cola Co., paste the following link into your browser.
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S&P Global STARS Distribution
In North America
As of September 30, 2010, research analysts at Standard & Poor's Equity Research Services North America recommended 39.2% of issuers with buy recommendations, 52.5% with hold recommendations and 8.3% with sell recommendations.
In Europe
As of September 30, 2010, research analysts at Standard & Poor's Equity Research Services Europe recommended 36.6% of issuers with buy recommendations, 43.2% with hold recommendations and 20.2% with sell recommendations.
In Asia
As of September 30, 2010 research analysts at Standard & Poor's Equity Research Services Asia recommended 46.8% of issuers with buy recommendations, 44.4% with hold recommendations and 8.8% with sell recommendations.
Globally
As of September 30, 2010, research analysts at Standard & Poor's Equity Research Services globally recommended 39.5% of issuers with buy recommendations, 50.2% with hold recommendations and 10.3% with sell recommendations.
5-STARS (Strong Buy): Total return is expected to outperform the total return of a relevant benchmark, by a wide margin over the coming 12 months, with shares rising in price on an absolute basis.
4-STARS (Buy): Total return is expected to outperform the total return of a relevant benchmark over the coming 12 months, with shares rising in price on an absolute basis.
3-STARS (Hold): Total return is expected to closely approximate the total return of a relevant benchmark over the coming 12 months, with shares generally rising in price on an absolute basis.
2-STARS (Sell): Total return is expected to underperform the total return of a relevant benchmark over the coming 12 months, and the share price is not anticipated to show a gain.
1-STARS (Strong Sell): Total return is expected to underperform the total return of a relevant benchmark by a wide margin over the coming 12 months, with shares falling in price on an absolute basis.
Relevant benchmarks: In North America, the relevant benchmark is the S&P 500 Index, in Europe and in Asia, the relevant benchmarks are generally the S&P Europe 350 Index and the S&P Asia 50 Index.
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SOURCE Standard & Poor's
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