AI Stock Memo: COKE - Coca-Cola Consolidated - RankAlpha

COKE

TentativeAI MemoPost-earnings T+3

Coca-Cola Consolidated

As of 2026-05-09/Post-earnings T+3/Confidence medium

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Data freshness

AI Memo

As of 2026-05-09 • Model: RankAlpha Sentiment Codex

Decision Panel

Action, confidence, horizon, and decision blockers at a glance.

Report quality notice

peer set is too generic or lacks enough direct operating comparators

Action

—

Confidence

medium

Horizon

—

Key catalyst

May 12 annual meeting is a dated checkpoint for post-print messaging • 2026-05-12

Expected move: -0%

Biggest risk

The post-print bear case is that headline growth overstated underlying earnings power. Adjusted gross margin fell 70 bps, adjusted operating margin fell 70 bps, adjusted net income fell 12.3%, and net interest expense rose to $32.1 million from $6.9 million as the balance sheet carries more debt after the 2025 repurchase transaction. If pricing continues to lag commodity, tariff, and labor inflation, the selloff can persist. [#8-K-2026-05-06] [#10-Q-2026-05-06]

Invalidation

Break below $158 or thesis failure.

What would change my mind?

The primary-source read is still constructive on core demand: Q1 volume rose 13.4% reported and 6.4% adjusted, adjusted net sales rose 8.5%, and management cited market share gains across the portfolio, with zero-sugar Sparkling offerings and Still brands such as Monster, Powerade, BODYARMOR, and smartwater contributing. Early debt paydown also helps the medium-term balance-sheet repair story. [#8-K-2026-05-06] [#10-Q-2026-05-06]

Research note

Recommendation

—

Confidence

medium

As of

2026-05-09

Base target

$181

p=50%

Bull target

$195

p=25%

Bear target

$158

p=25%

Key bullets

Fast scan of bull, bear, and watch items

BullKey bullets

Post-earnings margin digestion is now the key near-term swing factor
Cash generation and debt paydown can reduce the post-repurchase overhang if margins stabilize
The primary-source read is still constructive on core demand: Q1 volume rose 13.4% reported and 6.4% adjusted, adjusted net sales rose 8.5%, and management cited market share gains across the portfolio, with zero-sugar Sparkling offerings and Still brands such as Monster, Powerade, BODYARMOR, and smartwater contributing.

BearKey bullets

Adjusted gross margin and adjusted operating margin compressed as roughly $35 million of additional aluminum and tariff-related input costs outpaced pricing actions in Q1.
Calendar distortion complicates extrapolation because Q1 had six extra selling days versus the prior year while Q4 2026 will have six fewer selling days versus Q4 2025.
Higher leverage remains material: total debt was about $2.64 billion at April 3, 2026, and net interest expense rose sharply year over year.

WatchKey bullets

May 12 annual meeting is a dated checkpoint for post-print messaging

Summary

High-level snapshot

Recommendation

Model confidence

medium

Timeframe

Asset

Equity

Trigger

Post-earnings T+3

Base case: $181 (p=50%)

Bull/Bear spread: +7% / -13%

Vs latest close: Bull +7% · Base -0% · Bear -13%

Scenario probabilities

Bull Target: $195 (p=25%)Base Target: $181 (p=50%)Bear Target: $158 (p=25%)

Commentary

This T+3 earnings follow-up remains a tentative, cautious monitoring memo. Company-source evidence confirms strong adjusted sales growth, reported and adjusted volume gains, and market-share progress, but the immediate market reaction was negative: the stock traded at $174.31 on May 8 after the $177.61 May 7 anchor, consistent with investors focusing on adjusted margin compression, lower adjusted net income, and higher interest expense. Recent news tone is mixed rather than clearly bullish, and delayed analyst revision visibility remains thin because the packet has no target-summary data and no confirmed post-print target or estimate revisions were available here. The stronger peer set is now centered on public Coca-Cola-system bottlers, but those comps remain geographically imperfect, so confidence stays moderate.

As of 2026-05-09 • Updated bi-weekly / post-earningsSource: Internal modelMethodology

Analyst Summary

Thesis highlights from the latest analysis

Bull Case

Bear Case

Drivers

Scannable catalysts and supporting factors

Post-earnings margin digestion is now the key near-term swing factor
Cash generation and debt paydown can reduce the post-repurchase overhang if margins stabilize

Scenarios

Bull Target (Scenario probability)

$195 / p=25% prob

Base Target (Scenario probability)

$181 / p=50% prob

Bear Target (Scenario probability)

$158 / p=25% prob

Price $182 as of 2026-06-18

Nearest Scenario: Base (∆ 0%)

Targets vs latest close: Bull +7% · Base -0% · Bear -13%

Sentiment & Exposure

News Sentiment (30d)

-0.20

Social Sentiment (7d)

0.00

Events

Other notable items detected

EVENT2026-05-12
May 12 annual meeting is a dated checkpoint for post-print messaging
COKE's 2026 annual meeting is scheduled for May 12, 2026, giving investors a near-term management checkpoint after the Q1 release to listen for commentary on tariff-driven input costs, pricing recovery, leverage, and capital allocation discipline following the post-earnings share-price weakness. This is a modest event catalyst, not a thesis-changing catalyst by itself. [#DEF14A-2026-03-23] [#8-K-2026-05-06]
Prob 45.00% • Move 3.00% • Priced-in 35.00%

Short-term Catalysts

Next few weeks

Post-earnings margin digestion is now the key near-term swing factor
2026-05-20
Q1 headline growth was strong, but the quality of earnings was softer after adjusting for the six extra selling days: adjusted net sales rose 8.5%, adjusted gross profit rose 6.6%, adjusted operating income rose 2.2%, and adjusted net income fell 12.3%. Management said gross margin pressure included roughly $35 million of additional input costs tied to aluminum, geopolitical disruptions, supply constraints, and elevated import tariffs, while pricing actions did not fully offset those costs. With the stock trading at $174.31 on May 8 versus the $177.61 May 7 anchor, the near-term catalyst is whether investors continue to penalize margin compression despite volume and share gains. [#8-K-2026-05-06] [#10-Q-2026-05-06]
Prob 75% • Move 5% • Priced-in 70%

Long-term Catalysts

Months to a year

Cash generation and debt paydown can reduce the post-repurchase overhang if margins stabilize
2026-12-31
The company generated $205.3 million of operating cash flow in Q1, repaid $150.0 million on a term loan, and ended the quarter with total debt of about $2.64 billion versus about $2.79 billion at year-end. Management also expects roughly $300 million of 2026 capital expenditures and continues to frame supply-chain investment as part of the operating model, so deleveraging plus better margin conversion is the medium-term proof point. [#10-Q-2026-05-06]
Prob 60% • Move 7% • Priced-in 55%

Risks

Adjusted gross margin and adjusted operating margin compressed as roughly $35 million of additional aluminum and tariff-related input costs outpaced pricing actions in Q1.
Calendar distortion complicates extrapolation because Q1 had six extra selling days versus the prior year while Q4 2026 will have six fewer selling days versus Q4 2025.
Higher leverage remains material: total debt was about $2.64 billion at April 3, 2026, and net interest expense rose sharply year over year.
Labor and benefit inflation remained a headwind, and Still-category mix faced some drag from higher Dasani casepack mix and Protein-category supply constraints.

Peers

Symbol	Summary
KOF	Coca-Cola FEMSA is a more direct operating comparator than broad packaged-food peers because it is a public Coca-Cola-system bottler with volume, package mix, route-to-market, and input-cost exposure. Its Latin American footprint, FX exposure, and scale mean it is still an imperfect valuation comp for COKE's U.S.-focused bottling model.
CCEP	Coca-Cola Europacific Partners is another direct public Coca-Cola bottler and is useful for comparing bottler margin conversion, pricing versus inflation, and capital-return discipline. The limitation is geographic: CCEP's Europe and Asia-Pacific mix makes its demand, labor, currency, and regulatory exposures different from COKE's U.S. territory.

Sources

Internal and external references used in this analysis

Model source: RankAlpha Sentiment Codex
Human targets: serper
Analysis date: 2026-05-09