Morgan Stanley Upgrades Coca-Cola, 'Strengths Can Be Seen In Multiple Areas'

Analysts at Morgan Stanley on Monday upgraded The Coca-Cola Co KO from Equal-Weight to Overweight and setting a $47 price target. Coca-Cola is a leading multinational beverage manufacturer, retailer and marketer.

The Numbers

Despite relatively weak growth in net income, analysts see several sources of strength for Coca-Cola moving forward: “The company’s strengths can be seen in multiple areas, such as its expanding profit margins, reasonable valuation levels and notable return on equity.”

Analysts predict an improvement in topline growth from 2.75 percent in 2014 to 4.0 percent in 2015.

Modest Upside

Coca-Cola stock was up 1.3 percent Monday morning, although it recently traded at $42.39, up 0.6 percent. Morgan Stanley’s $47.00 price target represents about a 10.1 percent upside for the stock from current levels. Over the past year, Coke stock has returned 5.3 percent.

Other Analyst Action

Back in October, RBC Capital Markets reiterated an Outperform rating on Coke’s stock but lowered their price target from $50 to $47. Also in October, Gabelli & Co cut their rating from Buy  to Hold.