Coca-Cola FEMSA Surges 2.5% Amid Sector Shifts and Options Volatility: What’s Fueling the Rally?

Summary
• Coca-Cola FEMSA (KOF) trades at $96.88, up 2.51% intraday, hitting a 52-week high of $101.74
• Intraday range spans $94.60 to $97.38, with 80,302 shares traded
• RSI at 72.42 signals overbought territory, while MACD (1.67) crosses above signal line (1.46)
• Sector leader PepsiCo (PEP) declines 1.93%, contrasting KOF’s rally
Today’s surge in KOF reflects a confluence of technical momentum and sector-specific tailwinds. With the stock trading near its 52-week high and options activity intensifying, investors are weighing whether this breakout is a sustainable trend or a short-term spike. The beverage sector’s broader dynamics, including Dry January trends and non-alcoholic innovation, add layers of complexity to the move.

Non-Alcoholic Beverage Trends and Dry January Momentum Ignite KOF
KOF’s 2.51% intraday gain aligns with a broader shift in consumer behavior toward non-alcoholic alternatives, as highlighted by the surge in Dry January participation and the rise of alcohol-free brands like Athletic Brewing and FABRIC. The beverage sector’s valuation (31.8x P/E) remains elevated despite flat earnings growth, suggesting investor optimism about long-term structural shifts. While KOF’s core business remains tied to Coca-Cola’s global distribution, the stock’s performance appears decoupled from traditional beverage sector pressures, instead reflecting speculative bets on non-alcoholic innovation and moderation trends.

Beverage Sector Divergence: KOF Rallies as PEP Slumps
The beverage sector’s mixed performance underscores KOF’s divergence. PepsiCo (PEP), the sector’s leader, fell 1.93% amid concerns over declining sales and market share erosion. In contrast, KOF’s rally suggests investors are prioritizing non-alcoholic beverage growth narratives over traditional carbonated drink demand. This divergence highlights a strategic inflection point in the sector, where companies adapting to moderation trends (e.g., non-alcoholic cocktails, functional beverages) outperform peers reliant on legacy product lines.

Options and ETFs to Capitalize on KOF’s Volatility and Sector Rotation
• MACD: 1.67 (bullish crossover), RSI: 72.42 (overbought), 200D MA: 89.50 (below price), Bollinger Upper Band: 96.15 (near-term resistance)
• Key Levels: 95.00 (psychological support), 97.38 (intraday high), 85.65 (lower Bollinger band)
• Short-term bias remains bullish, with RSI near overbought and MACD expanding. However, the 200D MA and 52-week low ($72.68) provide long-term floor visibility.
Top Options:
• KOF20260220C95
- Call, $95 strike, 2026-02-20 expiry
- IV: 19.44% (moderate), Leverage: 23.92%, Delta: 0.61 (moderate sensitivity), Theta: -0.0249 (high time decay), Gamma: 0.0497 (moderate price sensitivity), Turnover: 405
- High leverage and moderate delta position this call for a 5% upside (target $101.72) with 23.9x potential return
• KOF20260515C85
- Call, $85 strike, 2026-05-15 expiry
- IV: 28.81% (elevated), Leverage: 6.92%, Delta: 0.78 (high sensitivity), Theta: -0.0149 (moderate time decay), Gamma: 0.0160 (low price sensitivity), Turnover: 7,000
- Long-dated call with high delta for capitalizing on sustained momentum, though lower gamma limits short-term responsiveness
Action: Aggressive bulls may consider KOF20260220C95 into a breakout above $97.38. For a longer-term play, KOF20260515C85 offers downside protection while capturing multi-month upside.

Backtest Coca-Cola FEMSA Stock Performance
The backtest of Coca-Cola's (KO) performance after an intraday surge of at least 3% from 2022 to the present shows favorable short-to-medium-term gains, highlighting the stock's potential for positive movement following strong price days. The backtest results indicate that:1. Frequency and Win Rates: The event occurred 504 times over the period, with a 3-day win rate of 51.79%, a 10-day win rate of 51.79%, and a 30-day win rate of 55.56%. This suggests that KO tends to experience positive returns in the immediate aftermath of a significant intraday gain.2. Returns: The average 3-day return following the event was 0.09%, the 10-day return was 0.30%, and the 30-day return was 0.66%. While these returns may seem modest, they reflect the compounding effect of multiple positive days, potentially leading to significant overall gains over a longer period.3. Maximum Return: The maximum return observed was 0.88%, which occurred on day 59 after the event. This highlights that while the immediate post-event returns may be modest, there is potential for further gains in the following weeks.In conclusion, KO has shown favorable performance after a 3% intraday surge in 2022, with a high win rate and positive returns over various short-to-medium-term horizons. This indicates that investors may find opportunities in the stock following strong price days, although the returns tend to be more modest in the immediate aftermath of the event.

KOF’s Rally: A Sector-Defining Move or Fleeting Spike?
KOF’s 2.5% surge reflects a pivotal moment in the beverage sector’s evolution, driven by non-alcoholic innovation and Dry January momentum. While technicals suggest short-term overbought conditions, the stock’s proximity to its 52-week high and elevated sector valuation (31.8x P/E) indicate sustained investor interest. Sector leader PepsiCo’s 1.93% decline underscores the importance of adapting to moderation trends. Investors should monitor KOF’s ability to hold above $95.00 and watch for follow-through volume in the options chain. For now, the rally appears justified by structural shifts, but caution is warranted as RSI nears overbought territory.