Coca-Cola is an American multi-national beverage company, which provides good exposure to international economies and currencies. Due to the government lockdowns, movie theatre, and sports arena closures, Coke’s sales fell in 2020. Coca-Cola has been a defensive stock; a defensive stock is a stock that provides consistent dividends and stable earnings regardless of the state of the overall stock market. This week, I review Coke’s Operating Segments, Key Ratios, derive the Intrinsic Value, and find the expected rate of return. Since this is a long video, please feel free to use the time stamps in the video if you only wish to watch certain topics.
I review various key ratios such as Revenue, Net Income, Shares outstanding, Book Value, Dividends, Payout Ratio, Free Cash Flows (FCF), Interest Coverage, Financial Leverage, Current Ratio, Quick Ratio, Debt to Equity Ratio, Return on Equity (ROE), Days Sales Outstanding, Days Inventory, Payables Period, Inventory Turnover, etc.
In the video, I also go over the makeup of Coke’s operating segments, the revenue and operating margin associated the each segment. I go over the geographies/locations that Coke is established in, and the international exposure that this company can provide.
Timestamp
0:00 Introduction
0:27 Operating Segments (10K Annual Report)
3:21 Key Ratios
15:33 Discounted Cash Flow Analysis / Intrinsic Value
17:20 Expected Rate of Return Calculation
18:20 Summary / Conclusion
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References:
Coca-Cola’s Website: here
Morningstar Key Ratios Link: here.
Useful Resources here.
Company overview: The Coca-Cola Company is an American multinational beverage corporation incorporated under Delaware’s General Corporation Law and headquartered in Atlanta, Georgia. The Coca-Cola Company has interests in the manufacturing, retailing, and marketing of nonalcoholic beverage concentrates and syrups.
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