Coca-Cola Femsa SAB de CV ADR

KOF: XNYS (USA)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	$86.00	Vcb	Gmksxdgc

Coca-Cola Femsa Earnings: Strong Volume and Revenue Management Initiatives Fuel Growth

Dan Su

Apr 28, 2023

We expect to maintain our $87 fair value estimate on wide-moat Coca-Cola Femsa after absorbing the bottler’s first-quarter results, with revenue up 12% and adjusted net profits (excluding financial instrument-related charges) up 13%, slightly outpacing our estimates of 11% and 12%, respectively. Our 10-year forecast for mid-single-digit percentage annual sales growth and operating margins averaging 14% remain in place. Shares are fairly valued, and we suggest investors wait for a better entry point as macro and political volatilities in Latin America call for a wider margin of safety.

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