-0.12 | -0.28%
COCA-COLA CO's gross profit margin for the first quarter of its fiscal year 2013 is essentially unchanged when compared to the same period a year ago. Sales and net income have dropped, underperforming the average competitor within its industry. COCA-COLA CO has weak liquidity. Currently, the Quick Ratio is 0.75 which shows a lack of ability to cover short-term cash needs. The liquidity decreased from the same period a year ago, despite already having weak liquidity to begin with. This would indicate deteriorating cash flow.
During the same period, stockholders' equity ("net worth") has remained virtually unchanged only decreasing by 1.02% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.
| Income Statement | Q1 FY13 | Q1 FY12 |
|---|---|---|
| Net Sales ($mil) | 11035.0 | 11137.0 |
| EBITDA ($mil) | 3002.0 | 3055.0 |
| EBIT ($mil) | 2529.0 | 2608.0 |
| Net Income ($mil) | 1751.0 | 2054.0 |
| Balance Sheet | Q1 FY13 | Q1 FY12 |
|---|---|---|
| Cash & Equiv. ($mil) | 18428.0 | 15779.0 |
| Total Assets ($mil) | 88450.0 | 83897.0 |
| Total Debt ($mil) | 35118.0 | 31115.0 |
| Equity ($mil) | 32480.0 | 32818.0 |
| Profitability | Q1 FY13 | Q1 FY12 |
|---|---|---|
| Gross Profit Margin | 65.1 | 64.97 |
| EBITDA Margin | 27.2 | 27.43 |
| Operating Margin | 22.92 | 23.42 |
| Sales Turnover | 0.54 | 0.56 |
| Return on Assets | 9.85 | 10.41 |
| Return on Equity | 26.83 | 26.61 |
| Debt | Q1 FY13 | Q1 FY12 |
|---|---|---|
| Current Ratio | 1.01 | 1.13 |
| Debt/Capital | 0.52 | 0.49 |
| Interest Expense | 102.0 | 88.0 |
| Interest Coverage | 24.79 | 29.64 |
| Share Data | Q1 FY13 | Q1 FY12 |
|---|---|---|
| Shares outstanding (mil) | 4448.0 | 4514.0 |
| Div / share | 0.28 | 0.26 |
| EPS | 0.39 | 0.45 |
| Book value / share | 7.3 | 7.27 |
| Institutional Own % | n/a | n/a |
| Avg Daily Volume | 1.5202203E7 | 1.3467838E7 |
BUY. The current P/E ratio indicates a discount compared to an average of 23.02 for the Beverages industry and a premium compared to the S&P 500 average of 18.47. For additional comparison, its price-to-book ratio of 5.75 indicates a significant premium versus the S&P 500 average of 2.36 and a discount versus the industry average of 6.11. The price-to-sales ratio is well above the S&P 500 average, but well below the industry average. Upon assessment of these and other key valuation criteria, COCA-COLA CO proves to trade at a discount to investment alternatives within the industry.
| Price/Earnings |
|
Price/Cash Flow |
| |||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| KO 22.03 | Peers 23.02 | KO 17.63 | Peers 16.35 | |||||||||||||||||||||
|
Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation. KO is trading at a valuation on par with its peers. |
Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures. KO is trading at a valuation on par to its peers. |
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| Price/Projected Earnings |
|
Price to Earnings/Growth |
|
|||||||||||||||||||||
| KO 17.86 | Peers 20.53 | KO 2.41 | Peers 2.00 | |||||||||||||||||||||
|
Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations. KO is trading at a valuation on par with its peers. |
Premium. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples. KO trades at a premium to its peers. |
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| Price/Book |
|
Earnings Growth |
|
|||||||||||||||||||||
| KO 5.75 | Peers 6.11 | KO 1.32 | Peers 10.90 | |||||||||||||||||||||
|
Average. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet. KO is trading at a valuation on par with its peers. |
Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios. However, KO is expected to significantly trail its peers on the basis of its earnings growth rate. |
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| Price/Sales |
|
Sales Growth |
|
|||||||||||||||||||||
| KO 3.90 | Peers 4.46 | KO 1.60 | Peers 4.88 | |||||||||||||||||||||
|
Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales. KO is trading at a discount to its industry on this measurement. |
Lower. A sales growth rate that trails the industry implies that a company is losing market share. KO significantly trails its peers on the basis of sales growth |
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