Coke (KO) Poised to Benefit from Reopening

KO was hit especially hard by pandemic-related shifts in consumer behaviors. Prior to lockdown, sales from bars, restaurants, stadiums, etc. comprised nearly 1/2 of its sales. Despite this, Coke was able to make strategic management decisions to somewhat offset the impact. Last quarter, KO unit case volume fell -3% YoY as all beverage segments reported volume declines. In 21Q1, this decline continued: YoY demand fell -20% YoY. However, we're starting to see light at the end of the tunnel. Coke Demand is ticking back up on a QoQ basis.

In addition, we're watching significant near-term strength from multiple brands under its umbrella:

• Dasani: +65% QoQ
• Simply Orange: +37% QoQ
• Diet Coke: +35% YoY
• Powerade: +35% QoQ
• Coca-Cola: +31% QoQ
• Coke Zero: +12% QoQ

As localities increasingly re-open, Coke is well positioned to capitalize. While the current quarter will likely show continued decline, guidance is getting brighter.