Key Takeaways
- Coca-Cola stock is up 36% this year. Bernstein raised its target to $95 from $93 after the Oct. 27 report and reiterated its Market Perform (Hold) rating on Nov. 3.
- The third quarter was strong. Organic revenue grew 7%, and management raised its 2026 outlook to comparable EPS growth of at least 11%.
- Analysts’ EPS estimates for 2027 and 2028 have barely moved, so the rally has come from a higher forward P/E, which is now near the top of its 10-year range.
- At 28x, the stock already prices in the quarter, and February’s 2027 guidance decides whether estimates catch up to the multiple.
Coca-Cola (KO) stock is up 36% this year. Bernstein raised its price target to $95 from $93 after Coca-Cola’s Oct. 27 report and reiterated its Market Perform rating, its equivalent of Hold, on Nov. 3.
That target is barely above Tuesday’s $94.80 close. So Bernstein liked the quarter but sees almost no upside from here.
The quarter earned the upgrades
Bernstein analyst Cristian Rios called the third quarter “another clean beat, and a raise.” He wasn’t alone in liking it. TD Cowen (to $104) and JPMorgan (to $98) also raised their targets after Coca-Cola’s Oct. 27 report, and the third quarter gave them plenty to work with:
- Unit case volume grew 5%, against 1% a year earlier.
- Organic revenue grew 7%, though price/mix added just 1%: pricing added 4 points, and mix took 3 of them back.
- Comparable EPS rose 11%, with 2 points of that from currency.
Management raised its 2026 outlook for the third time this year, to comparable EPS growth of at least 11% from $3.00.
TIKR tracks 25 analysts on Coca-Cola. How many say “Buy”?
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The estimates barely budged
But the stock has moved a lot more than the earnings have.
That guide works out to $3.33 or more this year, and analysts are at $3.34. Here’s what they expect for the years after:
That’s growth of 6% in 2027 and 7% in 2028, about the 6% a year Coca-Cola’s diluted EPS grew from 2015 to 2025. And earlier in October, consensus for both years was just a penny below where it is now.
So the rally came from the multiple. Coca-Cola traded at 21x forward earnings at the end of September 2025. As of Tuesday’s close, it was at 28x, near the top of its 10-year range:
Over the decade, it averaged 23x, and it set its 10-year high of 28x on Oct. 22. Investors are paying a lot more for nearly the same earnings.
Bernstein’s $95 target is about 28x the next twelve months’ estimates, so it assumes the stock simply holds that multiple.
A smaller Coca-Cola could earn a bigger premium
Coca-Cola has long traded at a premium for its steady earnings, and there’s a fair case for a bigger one now.
Management expects its pending sale of Coca-Cola Beverages Africa to weigh on 2027 revenue by about 8 points. That’s why consensus has revenue dipping next year before it grows again:
Bottling is the company’s least profitable business (the Bottling Investments segment earned a 7.4% operating margin in 2025), so each sale lifts the margins of what’s left. CFO John Murphy said the Africa deal should bring “positive impacts to both our margins and the return profile of our business.” A leaner Coca-Cola has a reasonable claim to more than the 23x it averaged as a bigger bottler.
But that margin lift is a one-time step. After Africa, growth has to come from selling more drinks at better prices.
February is the next real test
Management will give 2027 guidance with its fourth-quarter results in February. The Africa sale alone is set to take about 2 points off 2027 comparable EPS growth, with a slight currency drag on top. With the stock at 28x, that guide needs to point to EPS growth well above what analysts expect.
The other wild card is the IRS. A federal appeals court heard Coca-Cola’s tax case in June, and management expects a decision in the coming months. The company estimates a loss would mean about $14 billion more in tax and interest for 2010 through 2025, with more still accruing.
Bernstein’s Hold looks like the right call. Coca-Cola had a great quarter, and the stock already reflects it: buyers today pay a multiple near its 10-year high for 6% to 7% earnings growth. For that multiple to hold, February’s 2027 guide needs to get analysts raising their estimates by more than a penny.
Of course, a strong guide in February would change that quickly, and the Street’s highest target, $106, would start to look like the better call.
So what is Coca-Cola stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
