Coca-Cola (KO) Near Top Of Boom-Bust Cycle, Shares Downgraded

Shares of blue chip Coca-Cola (NYSE: KO) are seeing selling pressure today after a rare downgrade of the beverage giant.

JP Morgan downgraded Coke today from Overweight to Neutral, saying while it is doing "everything right" it is reaching the peak of the "boom-bust cycle." Most of the good news is already priced into the shares, according analyst John Faucher.

Faucher said while the market will likely receive the expected 4-6% organic revenue growth and low-double-digit EPS growth, the company needs to do more than that to expend its already 18% premium to its peer group. Faucher said while the current premium is deserved it is unlikely to expand, thus limiting further upside.

Financial estimates on Coke weren't reduced today, although the firm said recent strength in the dollar probably limits material upside at this point.

In addition to the Coke downgrade, the firm also downgraded other large consumer companies, Colgate-Palmolive (NYSE: CL) and Alberto Culver (NYSE: ACV).

Shares of KO are down 2.2% today, CL is down 2.4% and ACV is down 2.7%.

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