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Coca-Cola Co KO

Morningstar Rating
$61.20 +0.05 (0.08%)
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Company Report

Coca-Cola Earnings: Focus on Volume Expansion Prudent for Long-Term Sales and Profit Growth

We don’t plan any material changes to our $60 fair value estimate for wide-moat Coca-Cola after digesting its 2023 results, as sales growth of 6% and adjusted EPS of $2.69 matched our estimates. Despite a softening consumer backdrop and intense competition in the beverage aisle, we think Coca-Cola remains well-positioned to capture growth in the coming years thanks to heavy investments in innovations and brands, and deft in-market executions that assert its competitive standing globally. For 2024, we view management’s outlook for mid-single-digit sales growth as reasonable after adjusting for the impact of refranchising but plan to trim our adjusted EPS estimate by a low-single-digit percentage due to worse-than-expected near-term currency headwinds. Our 10-year projections for mid-single-digit sales growth and low-30s average operating margins remain in place.

Price vs Fair Value

KO is trading at a 2% premium.
Price
$61.20
Fair Value
$82.00
Uncertainty
Low
1-Star Price
$21.00
5-Star Price
$11.00
Economic Moat
Ybgy
Capital Allocation
Lxzzkkdv

Bulls Say, Bears Say

Bulls

Coke can leverage strong bottler relationships in underpenetrated emerging markets to drive volume growth with classic recipes as well as new products tailored to local tastes.

Bears

Secular headwinds in carbonated soft drink demand in developed markets are a challenge to Coca Cola’s long-term growth outlook.

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News

Trading Information

Previous Close Price
$61.15
Day Range
$61.0061.62
52-Week Range
$51.5564.99
Bid/Ask
$61.01 / $61.20
Market Cap
$263.92 Bil
Volume/Avg
13.6 Mil / 14.4 Mil

Key Statistics

Price/Earnings (Normalized)
22.37
Price/Sales
5.62
Dividend Yield (Trailing)
3.01%
Dividend Yield (Forward)
3.17%
Total Yield
3.67%

Company Profile

Founded in 1886, Atlanta-headquartered Coca-Cola is the world’s largest nonalcoholic beverage company, with a strong portfolio of 200 brands covering key categories including carbonated soft drinks, water, sports, energy, juice, and coffee. Together with bottlers and distribution partners, the company sells finished beverage products bearing Coca-Cola and licensed brands through retailers and food-service locations in more than 200 countries and regions globally. Coca-Cola generates around two thirds of its total revenues overseas, with a significant portion from emerging economies in Latin America and Asia-Pacific.
Sector
Consumer Defensive
Industry
Beverages - Non-Alcoholic
Stock Style Box
Large Core
Total Number of Employees
79,100

Competitors

Valuation

Metric
KO
NSRGY
KDP
Price/Earnings (Normalized)
22.3720.9017.87
Price/Book Value
9.847.271.71
Price/Sales
5.622.882.98
Price/Cash Flow
20.6717.3914.76
Price/Earnings
KO
NSRGY
KDP

Financial Strength

Metric
KO
NSRGY
KDP
Quick Ratio
0.720.490.20
Current Ratio
1.130.830.38
Interest Coverage
8.898.566.56
Quick Ratio
KO
NSRGY
KDP

Profitability

Metric
KO
NSRGY
KDP
Return on Assets (Normalized)
12.05%10.01%4.86%
Return on Equity (Normalized)
45.69%34.58%9.95%
Return on Invested Capital (Normalized)
17.60%14.97%7.37%
Return on Assets
KO
NSRGY
KDP
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Beverages - Non-Alcoholic Industry Comparables

Ticker
Name
Morningstar Rating for Stocks
Economic Moat
Market Cap
PEP
PepsiCo IncWfb$233.1 Bil
NNFSF
Nongfu Spring Co Ltd Class H Ordinary SharesPyqd$64.3 Bil
MNST
Monster Beverage CorpPzggzg$57.5 Bil
KDP
Keurig Dr Pepper IncSrzwm$41.9 Bil
CCEP
Coca-Cola Europacific Partners PLCBzrzlz$31.1 Bil
COCSF
Coca-Cola Femsa SAB de CV Series LGjqs$20.6 Bil
KOF
Coca-Cola Femsa SAB de CV ADRFwvq$20.6 Bil
CELH
Celsius Holdings IncLtqw$14.8 Bil
PRMW
Primo Water CorpZxg$2.5 Bil

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