EDITOR’S NOTE: Sam Collins will return on Feb. 21.
The Coca-Cola Co (NYSE:KO) shares look ready to rise up and out of a four-month consolidation range as KO stock challenges resistance at $42 a share. The move caps a long pullback from the April 2016 high near $46 — meaning the familiar consumer staples heavyweight is set for its first major uptrend in nearly a year.
As you read this, the company will have reported quarterly results for the fourth quarter. Analysts are looking for earnings of 37 cents per share (vs 38 cents last year) on an 8.7% decline in revenue to $9.135 billion. In the third quarter, the company reported organic revenue growth of 3% thanks to gains in the water and sports drinks categories.
Bottled water continues to be a major catalyst for growth. You might have noticed the LIFEWTR commercial from PepsiCo, Inc. (NYSE:PEP) during the Super Bowl; a product that competes directly with KO’s Smartwater brand.
Watch for a post-earnings breakout above its 200-day moving average, which should put the August high near $43.50 in play.
Anthony Mirhaydari is founder of the Edge and Edge Pro investment advisory newsletters. A two-week and four-week free trial offer has been extended to InvestorPlace readers.
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