Coca-Cola Co

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KO : NYSE : Consumer Goods
$43.63 | %
Today's Range: 43.48 - 43.75
Avg. Daily Volume: 11,537,700
07/29/16 - 4:01 PM ET

Financial Analysis


COCA-COLA CO's gross profit margin for the second quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Even though sales decreased, the net income has increased, representing an increase to the bottom line. COCA-COLA CO has weak liquidity. Currently, the Quick Ratio is 0.98 which shows a lack of 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 6.26% 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.

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Income Statement Q2 FY16 Q2 FY15
Net Sales ($mil)11539.012156.0
EBITDA ($mil)3601.03689.0
EBIT ($mil)3156.03201.0
Net Income ($mil)3448.03108.0


Balance Sheet Q2 FY16 Q2 FY15
Cash & Equiv. ($mil)24075.020947.0
Total Assets ($mil)94094.093538.0
Total Debt ($mil)48048.044314.0
Equity ($mil)26637.028418.0


Profitability Q2 FY16 Q2 FY15
Gross Profit Margin65.1164.96
EBITDA Margin31.230.34
Operating Margin27.3526.33
Sales Turnover0.460.49
Return on Assets8.098.07
Return on Equity28.5926.56
Debt Q2 FY16 Q2 FY15
Current Ratio1.211.14
Debt/Capital0.640.61
Interest Expense162.0128.0
Interest Coverage19.4825.01


Share Data Q2 FY16 Q2 FY15
Shares outstanding (mil)4315.04349.0
Div / share0.350.33
EPS0.790.71
Book value / share6.176.53
Institutional Own % n/a n/a
Avg Daily Volume1.1500166E71.5504975E7

Valuation


BUY. COCA-COLA CO's P/E ratio indicates a discount compared to an average of 29.64 for the Beverages industry and a value on par with the S&P 500 average of 25.07. For additional comparison, its price-to-book ratio of 7.03 indicates a significant premium versus the S&P 500 average of 2.81 and a discount versus the industry average of 7.74. The current price-to-sales ratio is well above the S&P 500 average, but 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
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
KO 24.94 Peers 29.64   KO 20.25 Peers 22.03

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

KO is trading at a discount to 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.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
KO 21.07 Peers 26.23   KO 1.60 Peers 1.29

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

KO is trading at a discount to 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.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
KO 7.03 Peers 7.74   KO 1.75 Peers -6.88

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.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

KO is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
KO 4.33 Peers 4.63   KO -5.40 Peers -4.86

Average. 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 valuation on par with 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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