COCO: Upcoming Tariff Relief Will Drive Margins Significantly Higher in 2026

Analysts have raised their price target for Vita Coco Company from approximately $49.63 to $51.78 per share. They cite anticipated long-term benefits from recent tariff relief measures for coconut water products and improved profit margin forecasts.

Analyst Commentary

Investor sentiment around Vita Coco Company remains largely positive, following tariff relief measures and price target increases. However, analysts highlight a mix of supportive factors and ongoing risks tied to valuation and future execution.

• Several bullish analysts have significantly raised their price targets. The highest new target reaches $58 per share, signaling confidence in Vita Coco’s growth trajectory.
• Upcoming tariff relief on coconut water is expected to reduce average tariff rates from 23% to about 6%. This could strengthen long-term profit margins and boost future earnings estimates.
• Expanded distribution opportunities, including shelf space gains at major retailers such as Walmart, are viewed as additional growth catalysts in the coming years.
• Analysts cite exemption of coconut water from global tariffs as a key factor resetting projected tariff expenses to zero for 2026, improving company financials.

• Bearish analysts note that, despite tariff relief, management does not expect a material financial impact on 2025 results. This may push meaningful gains further out.
• There is caution around muted pricing assumptions in the coming years, which could offset some benefits of lowered tariffs.
• Valuation concerns persist, with Vita Coco identified as one of the most expensive names in the consumer staples sector. This has prompted some to take a more neutral or conservative outlook.
• Some analysts are lowering medium-term margin and EBITDA forecasts, signaling caution on execution and the company’s ability to meet elevated investor expectations in 2026.

What's in the News

• The company completed the repurchase of 872,662 shares for $23.01 million under its ongoing buyback program. The latest tranche involved 4,715 shares repurchased for $0.15 million between July and September 2025 (Key Developments).
• Vita Coco raised its 2025 earnings guidance, projecting net sales between $580 million and $595 million. This outlook is driven by high-teens growth in its core coconut water business and the launch of Vita Coco Treats (Key Developments).
• Vita Coco has launched its first-ever Halloween mystery kits for Labubu dolls, featuring exclusive costumes inspired by new Strawberries & Creme and Orange & Creme Vita Coco Treats. These kits will be available in limited quantities to loyalty members starting October 1 (Key Developments).
• The "Major League Hydration by Vita Coco" campaign introduced a lineup of elite athletes who endorse Vita Coco as their preferred hydration beverage. The campaign highlights Vita Coco’s naturally occurring electrolytes and absence of artificial dyes (Key Developments).

Valuation Changes

• Consensus Analyst Price Target has risen slightly from $49.63 to $51.78 per share.
• Discount Rate has increased modestly from 6.78% to 6.96%.
• Revenue Growth assumptions have edged up from 10.48% to 10.94%.
• Net Profit Margin is expected to improve from 13.23% to 14.25%.
• Future P/E (price-to-earnings) ratio has fallen from 31.69x to 29.92x, signaling slightly lower valuation expectations.