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Citi On Beverages: Weighted X-Bar Sales Not Looking Great

Citi On Beverages: Weighted X-Bar Sales Not Looking Great

Citi reported that non-alcoholic beverage sales growth slumped in the most recent four-week period. Although Citi analyst Wendy Nicholson noted that the timing of the Easter holiday likely weighed on the April beverage numbers, the sales deceleration remains troubling for shareholders of The Coca-Cola Co (NYSE: KO), PepsiCo, Inc. (NYSE: PEP), Dr Pepper Snapple Group Inc. (NYSE: DPS) and Monster Beverage Corporation (NASDAQ: MNST).

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Here’s a full rundown of Citi’s numbers for the four weeks ending April 23:

  • Non-alcoholic ready-to-drink (NARTD) beverage sales were up 0.6 percent year-over-year (Y/Y) compared to +3.4 percent Y/Y in the prior four weeks.
  • Carbonated soft drink (CSD) sales (ex energy drinks) fell to -2.9 percent Y/Y versus -0.5 percent last period.
  • CSD volumes were down 5.9 percent Y/Y.
  • Low-calorie CDS sales were down 7.4 percent Y/Y.
  • Dr Pepper gained 0.2 percent CSD market share Y/Y while Coca-Cola and Pepsi lost 0.2 percent and 0.3 percent, respectively.
  • Energy drink sales growth fell from 5.2 percent in the past 12 weeks to just 3.9 percent Y/Y in the past four weeks.

  • Monster was the big winner in energy drinks, gaining 1.0 percent of market share Y/Y versus a 2.2 percent share decline for Red Bull.
  • Liquid tea sales growth decelerated from 6.9 percent in the past 12 weeks to just 5.0 percent in the most recent period.
  • Coca-Cola and Pepsi gained 1.9 percent and 1.8 percent liquid tea market share, while AriZona lost 2.1 percent Y/Y.

Disclosure: The author holds no position in the stocks mentioned.

Latest Ratings for KO

Oct 2020UBSMaintainsBuy
Oct 2020Morgan StanleyMaintainsOverweight
Jul 2020Morgan StanleyUpgradesEqual-WeightOverweight

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