We issued an updated research report on The Coca-Cola Company KO on May 16, 2016.On Apr 20, the beverage giant reported strong first-quarter 2016 results. Coca-Cola beat the Zacks Consensus Estimate for both earnings and sales in first-quarter 2016. Excluding Fx, earnings of 45 cents per share rose 8% on improved organic growth and higher operating margins. Organic revenues inched up 2%. However, soda volumes declined in the quarter due to challenges in many emerging markets.2015 was a “transition year” for Coca-Cola because of the changes implemented to create a new operating model. The company made tangible progress on this plan. The company implemented aggressive cost-cutting measures and several initiatives to drive growth during the year. The resultant savings are being deployed to fund marketing programs and in innovations to re-accelerate top-line growth, margin expansion and returns on capital. Other than aggressively cutting costs, the initiative included disciplined brand and growth investments as well as aligning incentive plans.Coca-Cola’s productivity and strategic initiatives led to better-than-expected results in 2015 with the trend continuing in 2016. Its increased marketing investments have led to volume growth, especially in North America.The company is also focused on refranchising in markets like Europe and Africa, which includes the planned creation of Coca-Cola European Partners in Western Europe and Coca-Cola Beverages Africa in Southern and Eastern Africa. Coca-Cola European Partners is a merger of three European bottlers including Coca Cola Enterprises, Inc. CCE. Coca-Cola will own an 18% stake in Coca-Cola European Partners and 11% in the new African bottler. In China, it has agreed to refranchise its company-owned bottling operations to its existing partners, COFCO and Swire.Coca-Cola’s transformative global re-franchising initiatives would boost margins and returns as well as ensure solid growth, despite hurting sales/profits in the near term.Coca-Cola is also pursuing investments in newer revenue platforms to boost long-term sales and profits. Coca-Cola acquired a stake and signed a deal with Monster Beverage Corporation MNST in Jun 2015 to distribute Monster products in additional territories. This will allow Coca-Cola to compete more effectively in the global energy category.Coca-Cola has also signed a distribution agreement with Suja, a high growth organic cold-pressed juice company to gain a foothold in this growing market. The company has also invested in the plant-based protein drinks platform through the acquisition of the beverage business of China Green Culiangwang Beverages Holdings in China.In early 2016, Coca-Cola acquired a 40% stake in Chi Limited, Nigeria's leading value-added dairy and juice company, to penetrate further into the energy juice and value-added dairy categories. These strategic investments will help the company to diversify beyond its calorie-loaded sparkling beverages and improve growth prospects.However, Coca-Cola’s top line needs to show sustained acceleration. Though markets like North America, Japan and India are consistently strong, continued weakness in some emerging markets like China, Russia and Brazil is holding back significant sales acceleration. Moreover, weak sparkling beverage volumes due to declining demand and currency and structural headwinds - mainly related to the bottler re-franchising initiatives - over the next couple of years remain challenges.Currently, Coca-Cola has a Zacks Rank #3 (Hold). A better-ranked beverage stock is Primo Water Corporation PRMW sporting a Zacks Rank #1 (Strong Buy).Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report COCA-COLA ENTRP (CCE): Free Stock Analysis Report COCA COLA CO (KO): Free Stock Analysis Report PRIMO WATER CP (PRMW): Free Stock Analysis Report MONSTER BEVERAG (MNST): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research