Why Coca-Cola (KO) Stock Is A 'Buy' At TheStreet

NEW YORK (TheStreet) -- TheStreet Ratings team rates The Coca-Cola Co.  (KO)  as a Buy with a ratings score of A.

Shares of Coca-Cola are up 0.55% to $41.35 on Monday afternoon.

TheStreet Ratings team has this to say about their recommendation:
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"We rate COCA-COLA CO (KO) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its expanding profit margins, reasonable valuation levels, increase in stock price during the past year and notable return on equity. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The gross profit margin for COCA-COLA CO is rather high; currently it is at 65.60%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 20.63% is above that of the industry average.
  • COCA-COLA CO' earnings per share from the most recent quarter came in slightly below the year earlier quarter. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, COCA-COLA CO reported lower earnings of $1.90 versus $1.96 in the prior year. This year, the market expects an improvement in earnings ($2.08 versus $1.90).
  • KO, with its decline in revenue, slightly underperformed the industry average of 4.5%. Since the same quarter one year prior, revenues slightly dropped by 1.4%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • The change in net income from the same quarter one year ago has significantly exceeded that of the Beverages industry average, but is less than that of the S&P 500. The net income has decreased by 3.0% when compared to the same quarter one year ago, dropping from $2,676.00 million to $2,595.00 million.
  • You can view the full analysis from the report here: KO Ratings Report

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