In this story I am going to address all ongoing Coca Cola shareholders. I will look into why despite ongoing dip, the longer-term fundamental drivers of the firm are still sound. Coca Cola current chance of distress is over 66.0 percent. Coca Cola shows prevailing Real Value of €41.0875 per share. The current price of the firm is €40.15. At this time the firm appears to be fairly valued. Macroaxis approximates value of Coca Cola from analyzing the firm fundamentals such as Operating Margin of 31.24%, Profit Margin of 8.70% and Return On Equity of 14.73% as well as examining its technical indicators and Probability Of Bankruptcy. In general, we favor to go long with undervalued instruments and to trade away overvalued instruments since at some point assets prices and their ongoing real values will blend.
The company has beta of 0.15. As returns on market increase, Coca Cola returns are expected to increase less than the market. However during bear market, the loss on holding Coca Cola will be expected to be smaller as well. The firm dividends can provide a clue to current valuation of the stock. The entity one year expected dividend income is about €0.52 per share. The company has Profit Margin (PM) of 8.7 % which can be a sign that it executes well on its competitive strategies and has a good control over its expenditures. This is very large. Similarly, it shows Operating Margin (OM) of 31.24 % which suggests for every 100 dollars of sales it generated a net operating income of 0.31.
There are currently many different techniques concerning forecasting the market as a whole as well as predicting future values of individual securities such as Coca Cola. Regardless of method or technology, to accurately forecast the stock market is more a matter of luck rather than a particular technique. Nevertheless, trying to predict the stock market accurately is still an essential part of the overall investment decision process. Using different forecasting techniques and comparing the results might improve your chances of accuracy even though unexpected events may often change the market sentiment and impact your forecasting results.
Please note, it is not enough to conduct a financial or market analysis of a single entity such as Coca Cola. Your research has to be compared to or analyzed against Coca Cola's peers to derive any actionable benefits. When done correctly, Coca Cola's competitive analysis will give you plenty of quantitative and qualitative data to validate your investment decisions or develop an entirely new strategy toward taking a position in Coca Cola.
How important is Coca Cola's Liquidity
Coca Cola financial leverage refers to using borrowed capital as a funding source to finance The Coca Cola ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Coca Cola financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Coca Cola's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Coca Cola's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the breakdown between Coca Cola's total debt and its cash.
How is Coca allocating its cash?
To perform a cash flow analysis of Coca Cola, investors first need to understand how to read the cash flow statement. A cash flow statement shows the amount of cash Coca Cola is receiving and how much cash it distributes out in a given period. The Coca Cola cash flow statement breaks down these inflows and outflows into different buckets, including operating activities, investing activities, and financing activities.
Is Coca Cola valued objectively by the market?
This firm reported revenue of 32.31B. Net Income was 3.1B with profit before overhead, payroll, taxes, and interest of 22.15B. Coca Cola price decrease over the last few months could raise concerns from investors as the firm closed today at a share price of 40.15 on 26406.000 in volume. The company executives were not very successful in positioning the firm components to exploit market volatility in January. However, diversifying your holdings with The Coca Cola Company or similar stocks can still protect your portfolio during high-volatility market scenarios. The stock standard deviation of daily returns for 30 days (very short) investing horizon is currently 1.5709. The below-average Stock volatility is a good sign for a longer term investment options and for buy-and-hold investors. Coca Cola maintains shares outstanding of 4.26b. Coca Cola is trading at 40.15. This is 1.57 percent decrease. Day high is 40.94. The bottom line, our primary buy vs. sell advice on the firm is Hold. Coca Cola is currently fairly valued with quite high chance of distress for the next two years.
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Vlad Skutelnik is a Macroaxis Contributor. Vlad covers stocks, funds, cryptocurrencies, and ETFs that are traded in North America, focusing primarily on fundamentals, valuation and market volatility. He has many years of experience in fintech, predictive investment analytics, and risk management. View Profile
This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Vlad Skutelnik do not own shares of The Coca Cola. Please refer to our Terms of Use for any information regarding our disclosure principles.
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