The Coca-Cola Company (KO) Intrinsic Value & DCF Valuation
Beverages - Non-Alcoholic · NYSE
Current Price
$89.08
Intrinsic Value
$92.35
+3.5% margin of safety
What Is The Coca-Cola Company's Intrinsic Value?
As of 2026-07-29, the base-case DCF model estimates the intrinsic value of The Coca-Cola Company (KO) at $92.35 per share, compared with a market price of $89.08, a margin of safety of +3.5%. The base case assumes 6.8% annual free cash flow growth and a 10.0% discount rate.
Across the sensitivity grid the estimate spans $76.77 to $110.11. Intrinsic value is an estimate built on assumptions, not a fact. A higher discount rate or slower growth pushes the estimate down, while stronger cash flow growth lifts it.
How the DCF works · Recalculate with your own assumptions · What is intrinsic value?
Is The Coca-Cola Company (KO) Undervalued?
At $89.08, KO trades about 3.5% below the base-case intrinsic value estimate. That is a real discount, but it stays short of the 30% margin of safety required before calling a stock undervalued.
COMPETITIVE MOAT
↑Global Brand Recognition and Loyalty
Coca-Cola possesses unparalleled brand equity, fostering deep consumer loyalty. This allows for premium pricing and consistent demand across diverse markets.
↑Extensive Distribution Network
The company's vast global bottling and distribution infrastructure creates significant barriers to entry. It ensures product availability and freshness worldwide.
↑Pricing Power and Inflation Shield
Coca-Cola's strong brand allows it to pass on rising costs to consumers. Its business model and margins are resilient to inflationary pressures.
INVESTMENT RISKS
↓Regulatory Scrutiny on Health
Increased government regulations and taxes related to sugar content and health impacts could affect sales and profitability.
↓Water Scarcity and Environmental Concerns
Dependence on water resources for production makes Coca-Cola vulnerable to water scarcity and environmental activism.
↓Geopolitical and Economic Instability
Global operations expose the company to risks from political unrest, trade disputes, and economic downturns in various regions.
Base case
KO base case valuation
Intrinsic Value
$92.35
Margin of safety
+3.5%
Expected annual return
+0.7%
Base case assumptions: 6.8% annual growth, 10.0% discount rate, 27x exit multiple, 5 year projection. Data as of 2026-07-29.
This base case uses default assumptions and is not financial advice. The intrinsic value changes significantly when the growth rate or discount rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the KO valuation
Adjust the growth rate, discount rate, and exit multiple to see how the intrinsic value and margin of safety for The Coca-Cola Company respond.
Open DCF Calculator for KOCompany Overview
The Coca-Cola Company, a beverage company, manufactures and sells various nonalcoholic beverages in the United States and internationally. The company provides Trademark Coca-Cola, sparkling soft drinks and flavors; water, sports, coffee, and tea; juice, value-added dairy, and plant-based beverages; and emerging beverages. It also offers beverage concentrates and syrups, as well as fountain syrups to fountain retailers comprising restaurants and convenience stores. The company sells its products under the Coca-Cola, Diet Coke/Coca-Cola Light, Coca-Cola Zero Sugar, caffeine free Diet Coke, Cherry Coke, Fanta, Sprite, Simply, Fanta Orange, Fanta Zero Orange, Fanta Zero Sugar, Fanta Apple, Sprite Zero Sugar, Simply Orange, Simply Apple, Simply Grapefruit, Fresca, Schweppes, Thums Up, Aquarius, Ayataka, BODYARMOR, Ciel, Costa, Crystal, Dasani, Fuze Tea, Georgia, glacéau smartwater, glacéau vitaminwater, Gold Peak, I LOHAS, Powerade, Topo Chico, Core Power, Del Valle, fairlife, innocent, Maaza, Minute Maid, Minute Maid Pulpy, Santa Clara, and dogadan brands. It operates through a network of independent bottling partners, distributors, wholesalers, and retailers, as well as through bottling and distribution operators. The Coca-Cola Company was founded in 1886 and is headquartered in Atlanta, Georgia.
Financial Metrics — KO Stock Valuation Data
Revenue/Share (TTM)
$11.65
FCF/Share (TTM)
$3.32
ROIC (TTM)
13.9%
ROE (TTM)
43.0%
P/FCF
26.8x
EV/EBITDA
21.2x
FCF Yield
3.73%
Debt/Equity
1.20x
Based on trailing twelve-month data, KO shows a free cash flow per share of $3.32 and a ROIC of 13.9%, key inputs for stock valuation using the DCF method. The P/FCF ratio of 26.8x and FCF yield of 3.73% are important context metrics when evaluating KO's stock valuation relative to peers.
Frequently Asked Questions
What is the intrinsic value of KO?
The Coca-Cola Company currently generates $3.32 in free cash flow per share. At the current price of $89.08, a DCF model would discount these cash flows at an appropriate WACC and apply a terminal growth rate to arrive at an intrinsic value. The result depends heavily on your growth and discount rate assumptions — a 1% change in WACC typically shifts the fair value estimate by 10-15%. In MiniValuator the model uses a single discount rate that you can edit directly, 10% by default, rather than a computed WACC.
Is KO undervalued?
KO trades at a P/FCF ratio of 26.8x with a free cash flow yield of 3.73%. This P/FCF is in a moderate range. However, whether KO is truly undervalued requires comparing the DCF intrinsic value to the current market price and evaluating whether the margin of safety is sufficient for your risk tolerance.
How do I value KO stock using DCF?
To perform a DCF valuation on The Coca-Cola Company: (1) Start with the trailing free cash flow per share ($3.32) as the base, (2) project future FCF growth over 5-10 years based on Beverages - Non-Alcoholic industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting KO's risk profile — with a debt-to-equity of 1.20x, capital structure is an important factor, and (4) add a terminal value for cash flows beyond the projection period.
What is DCF valuation and how does it apply to KO?
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For The Coca-Cola Company, this means projecting how much free cash flow the company will produce over the next 5-10 years, shaped by Beverages - Non-Alcoholic trends, then discounting those amounts to today's dollars. KO's ROIC of 13.9% shows moderate capital returns.
How does WACC affect KO stock valuation?
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For KO, with a debt-to-equity ratio of 1.20x, the capital structure directly influences WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%. At an EV/EBITDA of 21.2x, the market's implied discount rate can be reverse-engineered for comparison. In MiniValuator you set this discount rate yourself as a single editable number, 10% by default, instead of computing a formal WACC.
Learn More
- See KO PE Valuation → — Earnings-based stock valuation using PE ratio analysis
- DCF Methodology — Step-by-step guide to discounted cash flow analysis
- PE Methodology — Guide to PE ratio stock valuation
- WACC — Understanding the discount rate used in DCF
- Margin of Safety — How to evaluate downside protection
- Intrinsic Value — How to evaluate stock fair value
- How to Calculate Intrinsic Value — Complete guide for investors
Related Valuations
All Consumer Defensive valuationsDCF and P/E value KO with different methods and assumptions, so the two conclusions can differ. Compare the P/E fair value.
Price as of 2026-07-29. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.