Coca-cola Amatil Limited FPO

[baller18]

Have been watching Coca-Cola and wanting to invest in it as I think it can be one of those 'forever stocks.'
Right now its in a downtrend and I'm thinking it can be a good entry, however, I am trying to catch the falling knife, but once again, it is impossible to catch the falling knife.

Any members out there invested in this company?

[noodles]

Have been watching Coca-Cola and wanting to invest in it as I think it can be one of those 'forever stocks.'
Right now its in a downtrend and I'm thinking it can be a good entry, however, I am trying to catch the falling knife, but once again, it is impossible to catch the falling knife.

Any members out there invested in this company?

I'm still short CCA.AX. Obviously I don't see any short-term value. The supermarkets and pepsi are making it hard work for CCA.

[baller18]

Hey noodles,

I don't think pepsi has any competitive advantage of CCA though? Can you elaborate? and on the supermarket aspect as well?

[noodles]

Hey noodles,

I don't think pepsi has any competitive advantage of CCA though? Can you elaborate? and on the supermarket aspect as well?
From Morningstar...
"Coca-Cola Amatil, or Amatil, announced a weak result for the full-year fiscal 2013, driven by soft volumes in the grocery channel. Earnings before interest and tax, or EBIT, declined 6.9% before significant items, which is at the low end of the company’s 5% to 7% EBIT decline guided last November. Total revenue decreased 1.1%, primarily because of a weak year in the Australian beverage market, which experienced a 2.7% decline in revenue. Of particular concern is the performance of grocery channel sales as aggressive competitor pricing and retailer destocking resulted in an 8.2% decline in volumes. Amatil's pricing is now at a 49% premium to Pepsi Schweppes in the grocery channel, up from 43% in the previous year. We believe that the competitive environment is likely to deteriorate further in the short term, with management noting further competitor price declines in the grocery channel in January. The main positives from the result are operating cash flow, which was strong at AUD 733 million; and the final dividend being maintained in line with the previous year, albeit without the special dividend."

[noodles]

From Morningstar...
"Coca-Cola Amatil, or Amatil, announced a weak result for the full-year fiscal 2013, driven by soft volumes in the grocery channel. Earnings before interest and tax, or EBIT, declined 6.9% before significant items, which is at the low end of the company’s 5% to 7% EBIT decline guided last November. Total revenue decreased 1.1%, primarily because of a weak year in the Australian beverage market, which experienced a 2.7% decline in revenue. Of particular concern is the performance of grocery channel sales as aggressive competitor pricing and retailer destocking resulted in an 8.2% decline in volumes. Amatil's pricing is now at a 49% premium to Pepsi Schweppes in the grocery channel, up from 43% in the previous year. We believe that the competitive environment is likely to deteriorate further in the short term, with management noting further competitor price declines in the grocery channel in January. The main positives from the result are operating cash flow, which was strong at AUD 733 million; and the final dividend being maintained in line with the previous year, albeit without the special dividend."

Is is also worth noting that Morningstar value CCA at $12.

Until they stop their track record of disappointing the market, I'll remain short.

[baller18]

Thanks noodle! Will do more research on it!

[Penfold]

I have built my holding over the past year... I like the move into alcohol in Aussie and soft drinks in Indonesia. Always thought SPC was a funny fit for the company. Would prefer them to focus on drinks. And it has cost them heavily last quarter. Hopefully they get rid of it in future.

Yield is good, as is debt. Margins are improving as Pepsi seems to have backed off its aggressive pricing (it would always have to at some point). Seems to have a floor around $10.90. Its the sort of stock you could keep buying on the dips and it will provide good divvie flows for years to come.

[noodles]

Is is also worth noting that Morningstar value CCA at $12.

Until they stop their track record of disappointing the market, I'll remain short.

Well looks like they are disappointing again in their latest trading update.

First half EBIT down 15%.

[baller18]

Wu
Well looks like they are disappointing again in their latest trading update.

First half EBIT down 15%.
Still waiting.
Bit of a cyclical play dont u thino noodles?
Can't take the brand power away

[noodles]

Wu
Still waiting.
Bit of a cyclical play dont u thino noodles?
Can't take the brand power away
Baller. I have short timeframes. At current price, they will be on a FY15 pe of around 20. Expensive for a stock that has not increased their eps for years. It is now declining. Good value at around $6-7?

[baller18]

Baller. I have short timeframes. At current price, they will be on a FY15 pe of around 20. Expensive for a stock that has not increased their eps for years. It is now declining. Good value at around $6-7?
Yes, def agree bit expensive at the current PE ratio. Will def be in at 7 for me was thinking 8. However, I will wait for the downtrend to be broken to get in, as ccl is back in its downtrend again..

[noodles]

Yes, def agree bit expensive at the current PE ratio. Will def be in at 7 for me was thinking 8. However, I will wait for the downtrend to be broken to get in, as ccl is back in its downtrend again..

I would also wait until you get visibility that they have resolved their issues.

[winner69]

Analyst dummy spit of the year

http://www.smh.com.au/business/massive-dummy-spit-as-analyst-takes-coca-cola-amatil-to-task-20140411-36hkq.html

[axe]

$125,590,796.12 turnover day . and still going strong . :eek2:

[baller18]

Will definitely be getting in some time..
I just don't see any companies with a competitive advantage of coca-cola… I mean look around, every restaurant we go to has coke, not pepsi. People around are drinking coke and not pepsi.
Not just that, coca-cola are selling marked up water in indonesia and etc.
Coke has faced how many competitors since the 19th century and they are still here, the brand power is so strong, they have powerade and from pretty much every other drink we think of or drinking right at this moment, probably has coke at the back of i!
ONe major concern for me is they are highly leveraged with a debt to equity ratio above 150%…
Hmmm… will wait for the tides to turn, however, it is getting tastier and tastier as each day goes by

[winner69]

Will definitely be getting in some time..
I just don't see any companies with a competitive advantage of coca-cola… I mean look around, every restaurant we go to has coke, not pepsi. People around are drinking coke and not pepsi.
Not just that, coca-cola are selling marked up water in indonesia and etc.
Coke has faced how many competitors since the 19th century and they are still here, the brand power is so strong, they have powerade and from pretty much every other drink we think of or drinking right at this moment, probably has coke at the back of i!
ONe major concern for me is they are highly leveraged with a debt to equity ratio above 150%…
Hmmm… will wait for the tides to turn, however, it is getting tastier and tastier as each day goes by

Real money made by Coca Cola themselves. KO in the US

The bottlers like CC Amatil always have their ups and downs and get screwed by supermarkets and lose focus going into other drink and alcohol markets. Their core competency is essentially distribution

[axe]

Real money made by Coca Cola themselves. KO in the US

The bottlers like CC Amatil always have their ups and downs and get screwed by supermarkets and lose focus going into other drink and alcohol markets. Their core competency is essentially distribution


KO in the us owns 30% of amatil ( asx) shares to my knowledge.

[skid]

I talked to a woman who just came back from working at a pre school in the States--She was astounded that all they gave the kids in the way of liquids was soft drinks!
While this sort of thing bodes well for the big co.s ATM,there could be a backlash as diabetes and other problems esculate in all countries.
It then becomes a matter of how well the companies can adapt to promoting other items such as water and juice.
As more and more people become more health concious and health systems become more stressed those brand names like Coke and Pepsi could lose a bit of their punch (or even take a bigger hit if they are banned (like in New York).
This could cause negative growth for soft drinks and provide positive growth for the alternatives.
I would have a good look at what alternatives Coke has come up with.
In the States they have simply bought up fast food chains to ensure their products are sold there ,ie-Burger King-KFC-Pizza Hut-etc-etc.(not sure who owns what)
They either have one of the other (Coke-Pepsi)in terms of who owns them--So thats another thing to look at.
At some stage though people or Gov. are going to start to lay the blame for rotten teeth, diabetes,and obesity at their door step.
I personally believe the Coke-Pepsi era is coming to a close gradually and it will be more who has the best water or at least what appears to be the best health drink on the market.

[Snoopy]

I would have a good look at what alternatives Coke has come up with.
In the States they have simply bought up fast food chains to ensure their products are sold there ,ie-Burger King-KFC-Pizza Hut-etc-etc.(not sure who owns what)
They either have one of the other (Coke-Pepsi) in terms of who owns them--So thats another thing to look at.


Skid, Pepsi used to be the master franchise owner for KFC and Pizza Hut. But those businesses were demerged into a stand alone company called 'Tricon' which was later renamed YUM brands. The demerger occurred late last century. So KFC and Pizza Hut have been independent of Pepsi for more than 15 years now.

SNOOPY

discl: hold YUM

[winner69]

Will definitely be getting in some time..
I just don't see any companies with a competitive advantage of coca-cola… I mean look around, every restaurant we go to has coke, not pepsi. People around are drinking coke and not pepsi.
Not just that, coca-cola are selling marked up water in indonesia and etc.
Coke has faced how many competitors since the 19th century and they are still here, the brand power is so strong, they have powerade and from pretty much every other drink we think of or drinking right at this moment, probably has coke at the back of i!
ONe major concern for me is they are highly leveraged with a debt to equity ratio above 150%…
Hmmm… will wait for the tides to turn, however, it is getting tastier and tastier as each day goes by

CCL still not a buy according to this article
https://au.finance.yahoo.com/news/6-reasons-why-sell-coca-194523551.html

[axe]

Results of Strategic Review out today. 93 Page PDF very interesting read. DISC hold

[baller18]

Has anyone gotten back in CCL? Out of downtrend it seems...

[BFG]

I know one person who loves the SUGARY DRINK :D :D :D :D :D