COCA-COLA CO/THE (1KO.MI) Stock Fundamental Analysis
Europe - Euronext Milan - BIT:1KO - US1912161007 - Common Stock
61.33 EUR
+0.53 (+0.87%)
We assign a fundamental rating of 5 out of 10 to 1KO. 1KO was compared to 30 industry peers in the Beverages industry. 1KO has an excellent profitability rating, but there are some minor concerns on its financial health. 1KO does not seem to be growing, but still is valued expensively.
1. Profitability
1.1 Basic Checks
- In the past year 1KO was profitable.
- In the past year 1KO had a positive cash flow from operations.
- Each year in the past 5 years 1KO has been profitable.
- In the past 5 years 1KO always reported a positive cash flow from operatings.
1.2 Ratios
- Looking at the Return On Assets, with a value of 12.29%, 1KO belongs to the top of the industry, outperforming 96.67% of the companies in the same industry.
- 1KO has a Return On Equity of 41.70%. This is amongst the best in the industry. 1KO outperforms 100.00% of its industry peers.
- 1KO's Return On Invested Capital of 14.17% is amongst the best of the industry. 1KO outperforms 93.33% of its industry peers.
- 1KO had an Average Return On Invested Capital over the past 3 years of 11.98%. This is above the industry average of 8.18%.
- The last Return On Invested Capital (14.17%) for 1KO is above the 3 year average (11.98%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.29% | ||
| ROE | 41.7% | ||
| ROIC | 14.17% |
ROA(3y)10.61%
ROA(5y)10.21%
ROE(3y)41.22%
ROE(5y)41.26%
ROIC(3y)11.98%
ROIC(5y)11.6%
1.3 Margins
- 1KO has a better Profit Margin (27.34%) than 100.00% of its industry peers.
- 1KO's Profit Margin has been stable in the last couple of years.
- 1KO has a better Operating Margin (31.14%) than 96.67% of its industry peers.
- 1KO's Operating Margin has declined in the last couple of years.
- The Gross Margin of 1KO (61.63%) is better than 96.67% of its industry peers.
- In the last couple of years the Gross Margin of 1KO has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 31.14% | ||
| PM (TTM) | 27.34% | ||
| GM | 61.63% |
OM growth 3Y-5.6%
OM growth 5Y-3.48%
PM growth 3Y-3.68%
PM growth 5Y-1.15%
GM growth 3Y0.44%
GM growth 5Y0.1%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so 1KO is still creating some value.
- Compared to 1 year ago, 1KO has about the same amount of shares outstanding.
- 1KO has more shares outstanding than it did 5 years ago.
- The debt/assets ratio for 1KO is higher compared to a year ago.
2.2 Solvency
- 1KO has an Altman-Z score of 4.48. This indicates that 1KO is financially healthy and has little risk of bankruptcy at the moment.
- 1KO has a better Altman-Z score (4.48) than 90.00% of its industry peers.
- The Debt to FCF ratio of 1KO is 8.51, which is on the high side as it means it would take 1KO, 8.51 years of fcf income to pay off all of its debts.
- The Debt to FCF ratio of 1KO (8.51) is comparable to the rest of the industry.
- A Debt/Equity ratio of 1.46 is on the high side and indicates that 1KO has dependencies on debt financing.
- The Debt to Equity ratio of 1KO (1.46) is worse than 70.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.46 | ||
| Debt/FCF | 8.51 | ||
| Altman-Z | 4.48 |
ROIC/WACC1.76
WACC8.07%
2.3 Liquidity
- A Current Ratio of 1.21 indicates that 1KO should not have too much problems paying its short term obligations.
- 1KO has a Current ratio (1.21) which is comparable to the rest of the industry.
- 1KO has a Quick Ratio of 1.21. This is a bad value and indicates that 1KO is not financially healthy enough and could expect problems in meeting its short term obligations.
- 1KO's Quick ratio of 1.00 is amongst the best of the industry. 1KO outperforms 90.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.21 | ||
| Quick Ratio | 1 |
3. Growth
3.1 Past
- 1KO shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 5.32%.
- 1KO shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 6.42% yearly.
- 1KO shows a small growth in Revenue. In the last year, the Revenue has grown by 2.80%.
- The Revenue has been growing slightly by 4.78% on average over the past years.
EPS 1Y (TTM)5.32%
EPS 3Y7.32%
EPS 5Y6.42%
EPS Q2Q%6.49%
Revenue 1Y (TTM)2.8%
Revenue growth 3Y6.78%
Revenue growth 5Y4.78%
Sales Q2Q%3.87%
3.2 Future
- The Earnings Per Share is expected to grow by 7.18% on average over the next years.
- The Revenue is expected to grow by 3.00% on average over the next years.
EPS Next Y6.87%
EPS Next 2Y7.34%
EPS Next 3Y7.36%
EPS Next 5Y7.18%
Revenue Next Year4.49%
Revenue Next 2Y4.76%
Revenue Next 3Y4.59%
Revenue Next 5Y3%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- 1KO is valuated rather expensively with a Price/Earnings ratio of 24.15.
- The rest of the industry has a similar Price/Earnings ratio as 1KO.
- The average S&P500 Price/Earnings ratio is at 27.21. 1KO is around the same levels.
- A Price/Forward Earnings ratio of 21.64 indicates a rather expensive valuation of 1KO.
- Based on the Price/Forward Earnings ratio, 1KO is valued a bit more expensive than 66.67% of the companies in the same industry.
- 1KO is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 24.26, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.15 | ||
| Fwd PE | 21.64 |
4.2 Price Multiples
- 1KO's Enterprise Value to EBITDA ratio is rather expensive when compared to the industry. 1KO is more expensive than 80.00% of the companies in the same industry.
- 76.67% of the companies in the same industry are cheaper than 1KO, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 55.44 | ||
| EV/EBITDA | 20.87 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates 1KO does not grow enough to justify the current Price/Earnings ratio.
- 1KO has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)3.52
PEG (5Y)3.76
EPS Next 2Y7.34%
EPS Next 3Y7.36%
5. Dividend
5.1 Amount
- 1KO has a Yearly Dividend Yield of 2.84%. Purely for dividend investing, there may be better candidates out there.
- 1KO's Dividend Yield is comparable with the industry average which is at 2.61.
- Compared to an average S&P500 Dividend Yield of 1.82, 1KO pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.84% |
5.2 History
- The dividend of 1KO has a limited annual growth rate of 3.93%.
Dividend Growth(5Y)3.93%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- 1KO pays out 65.04% of its income as dividend. This is not a sustainable payout ratio.
- 1KO's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP65.04%
EPS Next 2Y7.34%
EPS Next 3Y7.36%
COCA-COLA CO/THE / 1KO.MI FAQ
What is the fundamental rating for 1KO stock?
ChartMill assigns a fundamental rating of 5 / 10 to 1KO.MI.
What is the valuation status of COCA-COLA CO/THE (1KO.MI) stock?
ChartMill assigns a valuation rating of 2 / 10 to COCA-COLA CO/THE (1KO.MI). This can be considered as Overvalued.
What is the profitability of 1KO stock?
COCA-COLA CO/THE (1KO.MI) has a profitability rating of 8 / 10.
What are the PE and PB ratios of COCA-COLA CO/THE (1KO.MI) stock?
The Price/Earnings (PE) ratio for COCA-COLA CO/THE (1KO.MI) is 24.15 and the Price/Book (PB) ratio is 9.88.
What is the earnings growth outlook for COCA-COLA CO/THE?
The Earnings per Share (EPS) of COCA-COLA CO/THE (1KO.MI) is expected to grow by 6.87% in the next year.