Analysts weighed in on Thursday on Coca-Cola Company (KO) announcing that its board of directors has set a succession plan for the beverage giant, with Chief Operating Officer Henrique Braun selected to succeed longtime CEO James Quincey next year.
TD Cowen analyst Robert Moskow said the firm views Braun as a high-quality successor and believes his experience in emerging markets and international operations makes him a strong fit for the CEO position. “When we met with Braun at Coca-Cola’s HQ in March, we found his efforts to improve operational performance through increased transparency and more open communications with the company’s bottler network as key contributors to the company’s recent success,” Moskow updated on the development.
Bank of America analyst Peter Galbo said the firm was not surprised by Braun’s selection given his increased visibility with investors over the past year. Braun was called a strong choice for Coca-Cola’s (KO) bottling system, with his roots as an operator in Latin America positioning him well with the company’s most important partners as the region has experienced some macro challenges and slowdowns in recent quarters.
Galbo and his team highlighted that Braun steps into the CEO role with Coca-Cola (KO) in a much stronger position than several years ago. “KO is delivering faster organic sales growth, operating with great efficiency, and has shifted to a more asset-light model,” he added. Importantly, Braun will oversee the finalizing of Coca-Cola’s (KO) bottler re-franchising efforts in Africa and India and will serve at a time when KO is still litigating its transfer pricing case with the IRS.
Morgan Stanley analyst Dara Mohsenian was also generally positive about Coca-Cola’s (KO) ability to replace Quincey. “Clearly it’s a loss for KO, but the company is well prepared in our minds with sustained competitive advantage and is set up for the transition, and we view Braun highly,” wrote Mohsenian.
Shares of Coca-Cola (KO) were up 0.8% in early trading on Thursday.