50% Off! Beat the market in 2025 with InvestingProCLAIM SALE

Morgan Stanley sees upside in Coca-Cola Europacific stock with buyback plans resuming

EditorEmilio Ghigini
Published 2024-12-09, 03:20 a/m
CCEP
-

On Monday, Coca-Cola (NYSE:KO) Europacific Partners (CCEP:NA) (NASDAQ: CCEP), a beverage giant with a market capitalization of $36 billion, received an upgraded stock rating from Morgan Stanley (NYSE:MS), moving from Equalweight to Overweight.

Accompanying this upgrade, the firm also increased its price target for the stock to EUR87.00, a significant rise from the previous EUR69.00. According to InvestingPro data, the stock currently maintains a strong "Buy" consensus among analysts, with an overall Financial Health Score of "GREAT."

The upgrade comes amid a positive performance for the company's stock, which has seen a year-to-date increase of 17%, although this trails behind the S&P 500's 28% gain. Morgan Stanley's analyst highlighted the potential for further growth, citing increased confidence in CCEP's fourth quarter of 2024 and the full year 2025 outlook.

The analyst also noted upcoming catalysts that could drive the stock's performance, including a likely inclusion in the FTSE 100 index and the anticipated resumption of share buybacks after several years.

Last week, at the Morgan Stanley Global Consumer & Retail Conference, CCEP's management expressed optimism about the company's trajectory, indicating a strong close to the year 2024. The analyst believes that CCEP is on track to meet its long-term growth algorithm, projecting a 4% increase in FX-neutral revenue and a 7% rise in operating income for 2025.

These projections are consistent with the consensus but are especially noteworthy given the current market environment where many consumer packaged goods (CPG) companies face uncertainty and risks to their estimates.

The firm's assessment also reflects a favorable view of CCEP's position following the US elections, as the company faces no direct tariff risks and has limited exposure to foreign exchange fluctuations. With a P/E ratio of 21.1 and impressive dividend growth of 81% over the last year, CCEP shows strong financial fundamentals.

Looking further ahead, Morgan Stanley sees unacknowledged opportunities for revenue and margin growth for CCEP in the Philippines and, in the longer term, in Indonesia. For a complete analysis of CCEP's valuation and growth potential, visit InvestingPro.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.