Yesterday, Coca-Cola reported earnings per share of $0.38 and $1.90 for Q4 and FY’13, respectively. Both represented drops of earnings over comparable previous periods as a result of a combination of flat consumption and unfavourable currency headwinds.
Coca-Cola’s 2014 guidance warns of continuing currency pressures in the coming quarter resulting in operating income decreases by as much as 10% in Q1, and as a result, the stock found it’s way down by 4% on the day.
Coke makes up 20% of my US holdings portfolio, so, while pressures on earnings does cause some concern, I was pleased to see that KO increased it’s dividend for the 52nd straight year. For shareholders of record on March 14th, quarterly dividends increased from $0.28 to $0.305, a solid 8.9% increase. I will provide updates to KO’s payout ratio once the 10-Q and K are filed, as I do not subscribe to the brain-dead dividend/earnings calculation, preferring instead a more telling look at free cash-flow (FCF).
Presently, The Coca-Cola Company is paying a 3.3% yield.