Coca-Cola Works to Maintain Momentum After Earnings

NEW YORK (TheStreet) -- Coca-Cola (KO) may not fall into the category of momentum stock, but that hasn't stopped it from trying as it works to add value for its shareholders. Shares, at around $40.50, are down 2.1% for the year to date.

The soda company reported better-than-expected quarterly revenue on Tuesday thanks to stepped-up advertising and higher sales in emerging markets including China. Global case volumes rose 2% in the quarter, led in part by a 12% increase in China. Coke focused on marketing heavily around the Chinese New Year and it paid off, the company told analysts.

Although Coke does not report sales in China per se, the country's results fall into Coke's Asia-Pacific region, which accounted for 13% of total sales last year. That may not be a staggering percentage, but Coke did say it plans on making China a priority, as it will invest $8 billion in the country during the next five years.

The soda company will also embark on a massive marketing campaign for the World Cup soccer tournament in June in an effort to boost global revenue grwoth. The promotional program will be Coke's largest in history for the World Cup, the company said, as it attempts to gain traction in Latin America and other emerging economies.

Sales in North America and Europe, however, are not as sparkly as the company's soft drinks. North America reported stable growth during an unusually cold winter, while sales in Europe fell 4%, as consumers migrate away from soda toward healthier drinks such as juices.

According to a recent report, total U.S. soda sales declined 3% in 2013, reaching its lowest sales volume since 1995. The trend has spurred Coke to diversify its product portfolio, adding juices, water and sports drinks.

In addition, in February, Coke bought a 10% stake in single-cup coffee brewer Keurig Green Mountain (GMCR), known for its K-cups. The deal is aimed at providing consumers with single servings of Coke through Green Mountain's Keurig Cold beverage system by 2015, an attempt to steal sales away from current market leader SodaStream International (SODA).

Although there are conflicting viewpoints on the future of soda, Coca-Cola as a company is making every effort to succeed as a business. With Coke's move to diversify, the company's success may not always be contingent on the strength of its classic fizzy soda.

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At the time of publication the author had no position in any of the stocks mentioned.

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This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

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