New DHI NVR LEN positions, Exited MCK MMC, Lowered ATVI GM CVX holdings
Highlights from Q2 2023 filing as compared to Q1 2023:
New positions in: DHI (~5.97 mln shares), LEN (~0.15 mln), NVR (~0.01 mln)
Increased positions in: OXY (affirmed increased to ~224.13 mln shares from ~211.71 mln shares), COF (to ~12.47 mln from ~9.92 mln)
Maintained positions in: BAC (~1032.85 mln shares), AAPL (~915.56 mln shares), KO (~400 mln shares), KHC (~325.63 mln shares), AXP (~151.61 mln shares), HPQ (~120.95 mln shares), DVA (~36.1 mln shares), MCO (~24.67 mln shares)
Decreased positions in: ATVI (to ~14.66 mln shares from ~49.44 mln shares), GM (to ~22 mln from ~40 mln), CVX (to ~123.12 mln from ~132.41 mln), GL (to ~2.52 mln from ~6.35 mln), CE (to ~5.36 mln from ~8.82 mln)
Highlights from 2022 Q1 filing as compared to Q4 2021:
New positions in: OXY (~136.37 mln shares), HPQ (~104.48 mln), PARA (~68.95 mln), C (~55.16 mln), ALLY (~8.97 mln), CE (~7.88 mln), MCK (~2.92 mln), MKL (~0.42 mln)
Increased positions in: CVX (to ~159.18 mln shares from ~38.25 mln shares), ATVI (to ~64.32 mln from ~14.66 mln), FWONK (to ~7.72 mln from ~2.12 mln), FND (to ~4.78 mln from ~0.84 mln), GM (to ~62.05 mln from ~60 mln) RH (to ~2.17 mln from ~1.82 mln)
Maintained positions in: BAC (~1010.1 mln shares), AAPL (~890.92 mln shares), KO (~400 mln shares), KHC (~325.63 mln shares), AXP (~151.61 mln shares), USB (~126.42 mln shares), DVA (~36.1 mln shares), MCO (~24.67 mln shares)
Decreased positions in: VZ (to ~1.38 mln shares from ~158.82 mln shares), STOR (to ~14.75 mln from ~24.42 mln), RPRX (to ~1.5 mln from ~8.65 mln), KR (to ~57.99 mln from ~61.41 mln)
Coca-Cola beats by $0.09, beats on revs; refrains from providing FY20 guidance
Reports Q3 (Sep) earnings of $0.55 per share, $0.09 better than the S&P Capital IQ Consensus of $0.46; revenues fell 9.0% to $8.65 bln vs the $8.37 bln S&P Capital IQ Consensus; Organic revenues (non-GAAP) declined 6%.
Price/mix declined 3% for the quarter driven by negative channel and package mix due to the impact of the coronavirus pandemic.
Unit case volume declined 4%, as continued strength in at-home channels was more than offset by coronavirus related pressure in away-from-home channels.
Since the company's last earnings update in July, global unit case volume trends have continued to improve. The pace in the third quarter was more gradual than the second quarter, and the percentage decline in global unit case volume for October month-to-date was low single digits. The company is seeing an elevated level of sales in at-home channels being more than offset by ongoing pressure in away-from-home channels, which are affected by the level of lockdown in a particular market.
The company lost value share in total nonalcoholic ready-to-drink (NARTD) beverages as an underlying share gain was more than offset by negative channel mix due to continued pressure in away-from-home channels, where the company has a strong share position.
As the coronavirus pandemic continues to evolve, there is uncertainty around its ultimate impact; therefore, the company's full year financial and operating results cannot be reasonably estimated at this time.
Coca-Cola beats by $0.01, reports revs in-line; not providing FY20 guidance
Reports Q2 (Jun) earnings of $0.42 per share, $0.01 better than the S&P Capital IQ Consensus of $0.41; revenues fell 28.0% year/year to $7.2 bln vs the $7.26 bln S&P Capital IQ Consensus.
Global Unit Case Volume Declined 16%.
As the coronavirus pandemic continues to evolve, there is uncertainty around its ultimate impact; therefore, the company's full year financial and operating results cannot be reasonably estimated at this time. For comparable net revenues (non-GAAP), the company expects a 3% to 4% currency headwind based on the current rates and including the impact of hedged positions. Q3 Comparable net revenues (non-GAAP) are expected to include a 3% to 4% currency headwind based on the current rates and including the impact of hedged positions.
Market share: The company lost value share in total nonalcoholic ready-to-drink (NARTD) beverages as an underlying share gain was more than offset by negative channel mix due to pressure in away-from-home channels, where the company has a strong share position.
Reports Q3 (Sep) earnings of $0.56 per share, in-line with the S&P Capital IQ Consensus of $0.56; revenues rose 8.3% year/year to $9.51 bln vs the $9.42 bln S&P Capital IQ Consensus. Organic revenues (non-GAAP) grew 5%. Revenue growth was driven by price/mix growth of 6%, partially offset by a 2% decline in concentrate sales.
Operating margin, which included items impacting comparability, was 26.3% versus 29.8% in the prior year. Comparable operating margin (non-GAAP) was 28.1% versus 30.7% in the prior year. Margins were unfavorably impacted by a 260 basis point headwind from currency and net acquisitions.
Price/mix grew 6% for the quarter through revenue growth management initiatives and a benefit from geographic mix. Concentrate sales were 4 points behind unit case volume growth due to the timing of shipments during the quarter, in addition to cycling the timing of shipments in Brazil in the prior year.
Unit case volume grew 2%, primarily driven by strong growth in developing and emerging markets in addition to solid growth in North America.
FY19 Outlook:
Co continues to see EPS of ~$2.08 (-1% to +1%), excluding non-recurring items, vs. $2.11 S&P Capital IQ Consensus; Now sees at least 5% growth in organic revenues (non-GAAP) (Previously saw 5%)
Q4 Outlook:
Comparable net revenues (non-GAAP): 12% tailwind from acquisitions, divestitures and structural items; 3% currency headwind based on the current rates and including the impact of hedged positions
Comparable operating income (non-GAAP): 7% currency headwind based on the current rates and including the impact of hedged positions
FY20 Outlook:
Comparable net revenues (non-GAAP): 1% to 2% currency headwind based on the current rates and including the impact of hedged positions
Comparable operating income (non-GAAP): 2% to 3% currency headwind based on the current rates and including the impact of hedged positions
COLUMBUS DAY: In honor of the holiday, US bond markets and the Federal Reserve Bank will be closed on Monday, October 14, 2019. Stock, options, and futures markets will be open.
Morning: ABCB AXP CFG GNTX IBKC KO KSU MAN SLB STT SXT SYF
Notable earnings reports:
JPMorgan (JPM), Johnson & Johnson (NYSE:JNJ), UnitedHealth Group (NYSE:UNH), Goldman Sachs (NYSE:GS), Wells Fargo (WFC), Citigroup (C), United Continental (NASDAQ:UAL), Charles Schwab (NYSE:SCHW) and BlackRock (NYSE:BLK) on October 15;
Netflix (NASDAQ:NFLX), IBM (NYSE:IBM), Bank of America (NYSE:BAC), Kinder Morgan (NYSE:KMI) and Abbott Laboratories (NYSE:ABT) on October 16;
Philip Morris International (NYSE:PM), Morgan Stanley (NYSE:MS) and Union Pacific (NYSE:UNP) on October 17; Coca-Cola (NYSE:KO), American Express (NYSE:AXP), State Street (NYSE:STT) and Gentex (NASDAQ:GNTX) on October 18.
The company said Friday it will buy the Costa coffee brand from British firm Whitbread for 3.9 billion pounds ($5.1 billion) in cash. Costa is Britain's biggest coffee company with over 2,400 coffee shops in the U.K. and another 1,400 in more than 30 countries. It has 460 in China, its second-biggest market.
Costa Limited, which was founded in London in 1971, has grown to become a major coffee brand across the world. The acquisition of Costa from parent company Whitbread PLC is valued at $5.1 billion and will give Coca-Cola a strong coffee platform across parts of Europe, Asia Pacific, the Middle East and Africa, with the opportunity for additional expansion.
Coca-Cola expects the transaction to be slightly accretive in the first full year, not taking into account any impact from purchase accounting. For the fiscal year 2018 (ending March 1, 2018), Costa generated revenue and EBITDA of 1.3 billion and 238 million GBP, respectively. This equates to roughly $1.7 billion in revenue and $312 million in EBITDA.
Because Coca-Cola expects the transaction to close in the first half of 2019, there is no change to 2018 guidance. The company's long-term targets also remain unchanged. Coca-Cola will provide additional information as part of comprehensive guidance provided during the fourth quarter 2018 earnings call.
Coca-Cola, which has over 500 brands in its stable including Fanta, innocent smoothies and Powerade sports drinks, certainly has the deep pockets to help push Costa on the world stage. In 2017, it generated operating income of $9.7 billion on revenues of $35.4 billion.
The deal represents a big return to Whitbread, which bought Costa in 1995 for 19 million pounds. Since then, Costa has grown from just 39 shops and in the year to March, Costa made an operating profit of 123 million pounds on sales of 1.29 billion.
In recent years, Whitbread has invested heavily in Costa's expansion overseas, but had been looking to siphon off the business to generate funds for the expansion and for its other business, the budget hotel chain Premier Inn.
Reports Q4 (Dec) earnings of $0.37 per share, in-line with the Capital IQ Consensus of $0.37; revenues fell 5.9% year/year to $9.41 bln vs the $9.17 bln Capital IQ Consensus. Revenue was impacted by a foreign currency exchange headwind of 2% and a headwind from acquisitions, divestitures, and structural items of 10%. Organic revenues (non-GAAP) grew 6% in the quarter, driven by price/mix growth of 6%. Core business organic revenues (non-GAAP) grew 7% in the quarter.
Comparable currency neutral operating margin (non-GAAP) in the quarter expanded nearly 230 basis points and expanded nearly 140 basis points for the full year. These improvements were driven by continued extensions of pricing initiatives, a slightly favorable cost environment, and our productivity program.
FY17 guidance:
Co issues downside guidance for FY17, sees EPS -1% to -4% or roughly $1.83-1.89 vs. $1.97 Capital IQ Consensus Estimate.
Sees approximately 3% growth in organic revenues (non-GAAP) 7% to 8% growth in comparable currency neutral income before taxes (structurally adjusted) (non-GAAP), driven by strong operating performance partially offset by an increasing interest rate environment.
For Q1:
KO sees Net revenues: 12% to 13% headwind from acquisitions, divestitures, and structural items; 1% to 2% currency headwind based on the current spot rates and including the impact of hedged positions.
Income before taxes: 1% to 2% structural headwind; 3% to 4% currency headwind based on the current spot rates and including the impact of hedged positions.
For FY18:
Net revenues: 16% to 17% headwind from acquisitions, divestitures, and structural items
Income before taxes: 1% to 2% structural headwind; low single-digit currency headwind based on the current spot rates and including the impact of hedged positions
