COCA-COLA CO/THE (KO) Stock Fundamental Analysis
NYSE:KO - New York Stock Exchange, Inc. - US1912161007 - Common Stock - Currency: USD
Overall KO gets a fundamental rating of 5 out of 10. We evaluated KO against 32 industry peers in the Beverages industry. While KO has a great profitability rating, there are quite some concerns on its financial health. KO is quite expensive at the moment. It does show a decent growth rate. Finally KO also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
KO had positive earnings in the past year.
KO had a positive operating cash flow in the past year.
KO had positive earnings in each of the past 5 years.
KO had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With an excellent Return On Assets value of 10.60%, KO belongs to the best of the industry, outperforming 84.38% of the companies in the same industry.
KO has a better Return On Equity (41.16%) than 93.75% of its industry peers.
KO has a Return On Invested Capital of 11.60%. This is comparable to the rest of the industry: KO outperforms 56.25% of its industry peers.
The Average Return On Invested Capital over the past 3 years for KO is in line with the industry average of 11.91%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.6% | ||
| ROE | 41.16% | ||
| ROIC | 11.6% |
ROA(3y)10.61%
ROA(5y)10.21%
ROE(3y)41.22%
ROE(5y)41.26%
ROIC(3y)12.93%
ROIC(5y)12.26%
1.3 Margins
With an excellent Profit Margin value of 23.00%, KO belongs to the best of the industry, outperforming 93.75% of the companies in the same industry.
In the last couple of years the Profit Margin of KO has remained more or less at the same level.
KO has a better Operating Margin (25.13%) than 81.25% of its industry peers.
In the last couple of years the Operating Margin of KO has declined.
KO has a Gross Margin of 61.07%. This is amongst the best in the industry. KO outperforms 96.88% of its industry peers.
In the last couple of years the Gross Margin of KO has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.13% | ||
| PM (TTM) | 23% | ||
| GM | 61.07% |
OM growth 3Y-6.65%
OM growth 5Y-3.56%
PM growth 3Y-3.68%
PM growth 5Y-1.15%
GM growth 3Y0.44%
GM growth 5Y0.1%
2. Health
2.1 Basic Checks
KO has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for KO remains at a similar level compared to 1 year ago.
The number of shares outstanding for KO has been increased compared to 5 years ago.
The debt/assets ratio for KO is higher compared to a year ago.
2.2 Solvency
KO has an Altman-Z score of 4.39. This indicates that KO is financially healthy and has little risk of bankruptcy at the moment.
KO has a Altman-Z score of 4.39. This is in the better half of the industry: KO outperforms 71.88% of its industry peers.
KO has a Debt/Equity ratio of 1.87. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 1.87, KO is not doing good in the industry: 81.25% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.87 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 4.39 |
ROIC/WACC1.38
WACC8.39%
2.3 Liquidity
A Current Ratio of 1.10 indicates that KO should not have too much problems paying its short term obligations.
KO has a Current ratio of 1.10. This is in the lower half of the industry: KO underperforms 62.50% of its industry peers.
A Quick Ratio of 0.89 indicates that KO may have some problems paying its short term obligations.
KO has a Quick ratio of 0.89. This is comparable to the rest of the industry: KO outperforms 59.38% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.1 | ||
| Quick Ratio | 0.89 |
3. Growth
3.1 Past
KO shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 5.86%.
Measured over the past 5 years, KO shows a small growth in Earnings Per Share. The EPS has been growing by 6.42% on average per year.
KO shows a small growth in Revenue. In the last year, the Revenue has grown by 1.77%.
Measured over the past years, KO shows a small growth in Revenue. The Revenue has been growing by 4.78% on average per year.
EPS 1Y (TTM)5.86%
EPS 3Y7.32%
EPS 5Y6.42%
EPS Q2Q%1.39%
Revenue 1Y (TTM)1.77%
Revenue growth 3Y6.78%
Revenue growth 5Y4.78%
Sales Q2Q%-0.13%
3.2 Future
Based on estimates for the next years, KO will show a small growth in Earnings Per Share. The EPS will grow by 6.66% on average per year.
KO is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.76% yearly.
EPS Next Y6.1%
EPS Next 2Y6.95%
EPS Next 3Y7.12%
EPS Next 5Y6.66%
Revenue Next Year4.15%
Revenue Next 2Y4.73%
Revenue Next 3Y5.04%
Revenue Next 5Y4.76%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
KO is valuated rather expensively with a Price/Earnings ratio of 24.86.
KO's Price/Earnings is on the same level as the industry average.
The average S&P500 Price/Earnings ratio is at 26.03. KO is around the same levels.
KO is valuated rather expensively with a Price/Forward Earnings ratio of 21.81.
KO's Price/Forward Earnings ratio is in line with the industry average.
When comparing the Price/Forward Earnings ratio of KO to the average of the S&P500 Index (21.94), we can say KO is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.86 | ||
| Fwd PE | 21.81 |
4.2 Price Multiples
KO's Enterprise Value to EBITDA is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 25.95 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates KO does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of KO may justify a higher PE ratio.
PEG (NY)4.08
PEG (5Y)3.87
EPS Next 2Y6.95%
EPS Next 3Y7.12%
5. Dividend
5.1 Amount
KO has a Yearly Dividend Yield of 2.85%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.82, KO pays a better dividend. On top of this KO pays more dividend than 81.25% of the companies listed in the same industry.
KO's Dividend Yield is a higher than the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.85% |
5.2 History
The dividend of KO has a limited annual growth rate of 3.93%.
KO has been paying a dividend for at least 10 years, so it has a reliable track record.
KO has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)3.93%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
KO pays out 77.42% of its income as dividend. This is not a sustainable payout ratio.
The dividend of KO is growing, but earnings are growing more, so the dividend growth is sustainable.
DP77.42%
EPS Next 2Y6.95%
EPS Next 3Y7.12%
71.85
+0.16 (+0.22%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryBeverages
Earnings (Last)
Earnings (Next)
Inst Owners64.53%
Inst Owner Change1.26%
Ins Owners0.57%
Ins Owner Change1.25%
Market Cap309.24B
Analysts81.11
Price Target79.07 (10.05%)
Short Float %1.04%
Short Ratio2.12
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.85% |
Yearly Dividend1.94
Dividend Growth(5Y)3.93%
DP77.42%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.4%
Min EPS beat(2)-0.7%
Max EPS beat(2)3.5%
EPS beat(4)3
Avg EPS beat(4)1.11%
Min EPS beat(4)-0.7%
Max EPS beat(4)3.5%
EPS beat(8)6
Avg EPS beat(8)1.33%
EPS beat(12)9
Avg EPS beat(12)1.44%
EPS beat(16)13
Avg EPS beat(16)3.57%
Revenue beat(2)1
Avg Revenue beat(2)0.74%
Min Revenue beat(2)-2.22%
Max Revenue beat(2)3.7%
Revenue beat(4)3
Avg Revenue beat(4)0.78%
Min Revenue beat(4)-2.22%
Max Revenue beat(4)3.7%
Revenue beat(8)4
Avg Revenue beat(8)0.21%
Revenue beat(12)6
Avg Revenue beat(12)0.39%
Revenue beat(16)9
Avg Revenue beat(16)1.03%
PT rev (1m)3.42%
PT rev (3m)7.73%
EPS NQ rev (1m)-1.67%
EPS NQ rev (3m)-1.65%
EPS NY rev (1m)0.33%
EPS NY rev (3m)0.15%
Revenue NQ rev (1m)-0.32%
Revenue NQ rev (3m)-0.29%
Revenue NY rev (1m)0.25%
Revenue NY rev (3m)1.2%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.86 | ||
| Fwd PE | 21.81 | ||
| P/S | 6.6 | ||
| P/FCF | N/A | ||
| P/OCF | 287.67 | ||
| P/B | 11.8 | ||
| P/tB | N/A | ||
| EV/EBITDA | 25.95 |
EPS(TTM)2.89
EY4.02%
EPS(NY)3.29
Fwd EY4.59%
FCF(TTM)-0.22
FCFYN/A
OCF(TTM)0.25
OCFY0.35%
SpS10.89
BVpS6.09
TBVpS-1.29
PEG (NY)4.08
PEG (5Y)3.87
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.6% | ||
| ROE | 41.16% | ||
| ROCE | 15.12% | ||
| ROIC | 11.6% | ||
| ROICexc | 13.89% | ||
| ROICexgc | 25.57% | ||
| OM | 25.13% | ||
| PM (TTM) | 23% | ||
| GM | 61.07% | ||
| FCFM | N/A |
ROA(3y)10.61%
ROA(5y)10.21%
ROE(3y)41.22%
ROE(5y)41.26%
ROIC(3y)12.93%
ROIC(5y)12.26%
ROICexc(3y)15.62%
ROICexc(5y)14.7%
ROICexgc(3y)32.19%
ROICexgc(5y)29.87%
ROCE(3y)16.38%
ROCE(5y)15.53%
ROICexcg growth 3Y-0.66%
ROICexcg growth 5Y2.12%
ROICexc growth 3Y1.18%
ROICexc growth 5Y0.05%
OM growth 3Y-6.65%
OM growth 5Y-3.56%
PM growth 3Y-3.68%
PM growth 5Y-1.15%
GM growth 3Y0.44%
GM growth 5Y0.1%
F-Score5
Asset Turnover0.46
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.87 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 3.81 | ||
| Cap/Depr | 185.46% | ||
| Cap/Sales | 4.27% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 8.36% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.1 | ||
| Quick Ratio | 0.89 | ||
| Altman-Z | 4.39 |
F-Score5
WACC8.39%
ROIC/WACC1.38
Cap/Depr(3y)157.99%
Cap/Depr(5y)128.95%
Cap/Sales(3y)3.96%
Cap/Sales(5y)3.8%
Profit Quality(3y)78.5%
Profit Quality(5y)92.52%
High Growth Momentum
Growth
EPS 1Y (TTM)5.86%
EPS 3Y7.32%
EPS 5Y6.42%
EPS Q2Q%1.39%
EPS Next Y6.1%
EPS Next 2Y6.95%
EPS Next 3Y7.12%
EPS Next 5Y6.66%
Revenue 1Y (TTM)1.77%
Revenue growth 3Y6.78%
Revenue growth 5Y4.78%
Sales Q2Q%-0.13%
Revenue Next Year4.15%
Revenue Next 2Y4.73%
Revenue Next 3Y5.04%
Revenue Next 5Y4.76%
EBIT growth 1Y-12.62%
EBIT growth 3Y-0.32%
EBIT growth 5Y1.05%
EBIT Next Year15.34%
EBIT Next 3Y9.67%
EBIT Next 5Y6.76%
FCF growth 1Y-110.3%
FCF growth 3Y-25.04%
FCF growth 5Y-10.85%
OCF growth 1Y-89.82%
OCF growth 3Y-18.62%
OCF growth 5Y-8.26%