Coca-Cola's (KO 0.34%) share prices have effectively been flat over the past two-and-a-half years, but that could change soon.
Barclays analyst Lauren Lieberman recently raised her firm's 12-month price target on Coca-Cola from $66 to $68, representing an eventual 17% upside over the current share price. Lieberman has an overweight (buy) rating on the shares.
The beverage giant has continued to grow revenue over the last few years, and with the global soft drinks market still expanding, the stock could be a smart buy right now.
Why buy Coca-Cola stock?
The consensus Wall Street estimate calls for Coke's organic (non-GAAP) revenue to be roughly flat this year. That would be a step down from the company's organic revenue growth of 12% in 2023.
However, Coca-Cola's marketing was credited for the strong growth last year, and that expertise will come in handy as the brand looks to reach new customers in emerging markets. The global carbonated soft drinks market is estimated to grow from $445 billion in 2022 to $630 billion by 2030, according to Zion Market Research.
Barclays analyst said she believes Coke stock could benefit in the near term as investors start looking for better value within consumer health and beverage markets. On that note, Coke shares trade at an attractive forward price-to-earnings ratio of less than 21, which is below its previous five-year average valuation of 27 times trailing earnings.
Assuming the company meets the consensus earnings-per-share estimate of $2.64 this year, the stock could reach the analyst's $68 price target if the stock's valuation reverts to its previous average.
