Jul 24, 2019 Coca-Cola figures out what energy is good energy Read More Some numbers matter more than others... Take Coca-Cola's revenues last quarter. They were expected by Wall Street to be $9.99B — They were actually $10.0B. But that's not why the stock flew up 6% Tuesday. The real reason is Coke upgraded its sales growth expectations for 2019 from 4% to 5%. For a company as huge as Coke, that extra percentage point is big.
Coke's the 5th most valuable brand on earth... But in the US, it needs a brand-aid. Word's gotten out that carbonated water is probably better for you when not mixed with sweet syrup or aspartame. It didn't experience growth in its classic Coca-Cola brand, and the plan to revive it feels desperate: Bring the 80's back with product placements in Stranger Things Season 3.
The Takeaway:Coke has now discovered "good energy"... A key company goal is to "expand energy" (the natural kind). Coke acquired Costa Coffee in the UK for $4.9B, and Coca-Cola Energy has been launched in 14 countries (no ETA yet for the US) — its caffeine comes from natural sources. Plus, its Diet Coke spin-off, aka Coca-Cola Zero Sugar, has grown double-digit percentage amounts for 7 straight quarters. May 16, 2019 LaCroix is down because sparkling water is having a moment Read More Pamplemousse problems... Flavored sparkling water LaCroix has become the spirit drink of youthfulness — Millennial-powered anti-soda consumption pushed parent National Beverage Corp's stock to an all-time high in 2017 (FYI, great stock ticker: “FIZZ”). It has lost half its value since then, summed up by this stat:
Sales of sparkling water rose 16% in the US from Nov-Jan — but LaCroix’s sales fell 2%.
Pour some Pepsi on the wounds... Some banks decided to weigh in on issues the icon of calorie-free refreshment is facing. It's mainly competition. Lots more competition:
Bank #1: Thinks sales will “significantly decelerate,” so it downgraded the stock.
Bank #2: Thinks LaCroix’s getting bullied by soda — Pepsi's sleek Bubly is winning market share, while Coke is pumping out sparkling versions of Dasani and SmartWater.
Highlight: Texas-based Topo Chico is a fast-growing LaCroix-replacement that's gaining liquid ground.
Side Note: In March, National Beverage's colorful CEO blamed its sales drop on "injustice."The Takeaway:LaCroix's gone flat on the big stage... Before sparkling water became the avo toast of drinks, National Beverage shares grew 7-times larger from 2014 to 2018. Now LaCroix is struggling to distribute itself. Its Coke/Pepsi competitors are filling up convenience stores where LaCroixs aren't. If you're not on the shelf, you can't be bought. Apr 12, 2019 Keurig Dr. Pepper downgraded despite cocktail K-Cups Read More
All latte highs come to an end... That's the message from a Morgan Stanley analyst who downgraded K-Cup icon Keurig Dr. Pepper. Shares fell 4% after he said the single-cup coffee's explosive growth era is ending. Blame Keurig's patent expiration and competition from Nespresso.
You take that mid-week cosmo shaken or stirred?... Cocktail mixing is now automated thanks to the recently-announced Keurig "Drinkworks" machine. It's a joint venture with Bud-owner AB-InBev, but the partnership is a result of both companies' insecurity: slowing growth.
The dream: If you already toss in Keurig coffee pods in the morning, a Drinkworks cocktail was strategically conceived as your Keurig product in the evening.
The reality: That $4 Moscow Mule pod may save you compared to $10 at the bar, but the $299 Drinkworks machine isn't cheap.
And the history: Keurig's had partnership problems before — Its "Keurig Kold" creation with Coca-Cola was shut down in 2016.The Takeaway:The "razor and blades business model" isn't working here... That's when you sell one cheap item (razor) then make money off expensive refills (razor blades). Or your printer and its absurdly-priced ink. Keurig embraced the same model, but fresh competition makes its "cheap" entry pod machines too expensive to ever start.