The Vita Coco Company, Inc. (COCO): A Bull Case Theory 

We came across a bullish thesis on The Vita Coco Company, Inc. on Kroker Equity Research’s Substack. In this article, we will summarize the bulls’ thesis on COCO. The Vita Coco Company, Inc.’s share was trading at $55.00 as of February 4th. COCO’s trailing and forward P/E were 50.05 and 28.82 respectively according to Yahoo Finance.

The Vita Coco Company (COCO) has evolved from a trendy beverage brand into a profitable, cash-generative global leader in functional hydration, anchored by its flagship coconut water. Founded in 2004, the company has expanded its portfolio into coconut milk, juice, and newer growth bets like Vita Coco Treats and PWR LIFT, while following an asset-light model that sources coconuts from 17 partner facilities across Asia and Latin America.

This structure keeps capital requirements low, enables scalable growth, and supports flexibility through supply-chain disruptions. Today, Vita Coco dominates the U.S. market with over 40% share and holds 82% in the U.K., while also maintaining strong international presence across 35+ countries.

Financially, Vita Coco has demonstrated resilience and operational leverage. Revenue grew from $311 million in 2020 to $516 million in 2024, while net income rose from $47 million to $56 million, driven by pricing, cost efficiencies, and strong consumer demand.

Despite a 2022 margin compression from supply-chain inflation, profitability rebounded sharply in 2023–2024, with EBIT margins reaching mid-teens and free cash flow margins near 20% in Q3 2025. The balance sheet remains exceptionally strong, with minimal debt and substantial cash, giving the company flexibility for growth, share buybacks, or selective acquisitions.

Vita Coco’s competitive advantages include a dominant, recognizable brand, wide omni-channel distribution, asset-light supply chain, and disciplined product innovation close to its core. The company benefits from long-term health and wellness trends, offering both pricing power and margin expansion.

While risks include heavy reliance on coconut water, customer concentration, competition from global beverage giants, and exposure to commodity costs, the company’s founder-led, experienced management has shown consistent execution and capital discipline. With strong 2025 guidance, international expansion opportunities, and incremental product optionality, Vita Coco represents a rare, high-quality growth platform in beverages, combining robust cash generation with a durable brand moat.

Previously, we covered a bullish thesis on The Coca-Cola Company (KO) by Rijnberk InvestInsights in February 2025, which highlighted KO’s resilient organic revenue growth, margin expansion, EPS growth, and strong free cash flow. KO’s stock price has appreciated by approximately 12.31% since our coverage. Kroker Equity Research shares a similar perspective but emphasizes The Vita Coco Company (COCO), highlighting international growth, asset-light scalability, and category leadership.

The Vita Coco Company, Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 28 hedge fund portfolios held COCO at the end of the third quarter which was 29 in the previous quarter. While we acknowledge the risk and potential of COCO as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than COCO and that has 10,000% upside potential, check out our report about this cheapest AI stock.

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Disclosure: None.