Coca-Cola Co

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KO : NYSE : Consumer Goods
$45.86 -0.34 | -0.74%
Today's Range: 45.85 - 46.33
Avg. Daily Volume: 1.04765E7
08/17/17 - 4:00 PM ET

Financial Analysis


COCA-COLA CO's gross profit margin for the second quarter of its fiscal year 2017 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 average liquidity. Currently, the Quick Ratio is 1.08 which shows that technically this company has the ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.

During the same period, stockholders' equity ("net worth") has decreased by 17.40% from the same quarter last year. Together, the key liquidity measurements indicate that it is relatively unlikely that the company will face financial difficulties in the near future.

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Income Statement Q2 FY17 Q2 FY16
Net Sales ($mil)9702.011539.0
EBITDA ($mil)3200.03601.0
EBIT ($mil)2899.03156.0
Net Income ($mil)1371.03448.0


Balance Sheet Q2 FY17 Q2 FY16
Cash & Equiv. ($mil)27224.024075.0
Total Assets ($mil)91146.094094.0
Total Debt ($mil)49638.048048.0
Equity ($mil)22001.026637.0


Profitability Q2 FY17 Q2 FY16
Gross Profit Margin65.3965.11
EBITDA Margin32.9831.2
Operating Margin29.8827.35
Sales Turnover0.430.46
Return on Assets4.558.09
Return on Equity18.8528.59
Debt Q2 FY17 Q2 FY16
Current Ratio1.351.21
Debt/Capital0.690.64
Interest Expense193.0162.0
Interest Coverage15.0219.48


Share Data Q2 FY17 Q2 FY16
Shares outstanding (mil)4268.04315.0
Div / share0.370.35
EPS0.320.79
Book value / share5.156.17
Institutional Own % n/a n/a
Avg Daily Volume1.0614778E71.3825481E7

Valuation


BUY. COCA-COLA CO's P/E ratio indicates a significant premium compared to an average of 36.56 for the Beverages industry and a significant premium compared to the S&P 500 average of 24.31. For additional comparison, its price-to-book ratio of 8.87 indicates a significant premium versus the S&P 500 average of 3.03 and a significant premium versus the industry average of 7.30. The price-to-sales ratio is well above both the S&P 500 average and the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, COCA-COLA CO proves to trade at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
KO 47.65 Peers 36.56   KO 23.33 Peers 20.38

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

KO is trading at a significant premium to its peers.

 

Premium. 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 premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
KO 23.10 Peers 24.80   KO 1.74 Peers 1.62

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.

 

Average. 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 valuation on par to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
KO 8.87 Peers 7.30   KO -44.83 Peers 9.81

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

KO is trading at a premium to 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.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
KO 5.02 Peers 4.48   KO -10.15 Peers 13.88

Premium. 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 premium 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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