The Coca-Cola Company (KO) Stock Valuation — DCF Analysis
Beverages - Non-Alcoholic · NYSE
Current Price
$82.62
Intrinsic Value
$84.43
+2.1% margin of safety
COMPETITIVE MOAT
↑Global Brand Recognition
Coca-Cola's iconic brand is instantly recognizable worldwide, fostering strong consumer loyalty and pricing power. This deep-seated familiarity is difficult for competitors to replicate.
↑Extensive Distribution Network
The company possesses an unparalleled global bottling and distribution infrastructure. This allows for efficient product placement and availability, creating a significant barrier to entry.
↑Scale and Bargaining Power
Coca-Cola's immense scale provides significant leverage with suppliers and retailers. This allows for favorable terms and cost efficiencies that smaller rivals cannot match.
INVESTMENT RISKS
↓Shifting Consumer Preferences
Growing health consciousness and demand for healthier alternatives pose a threat. Consumers are increasingly seeking lower-sugar and natural beverage options.
↓Intensifying Competition
The beverage market is highly competitive with numerous global and local players. New entrants and innovative products constantly challenge market share.
↓Regulatory and Environmental Pressures
Increasing scrutiny on sugar content, plastic packaging, and water usage can lead to higher operating costs and potential restrictions. These factors can impact profitability and brand image.
Base case
KO base case valuation
A base case discounted cash flow model for KO estimates an intrinsic value of about $84.43 per share, against a current price of $82.62. The model assumes 6.9% annual free cash flow growth, a 10.0% discount rate, and a 28x exit multiple.
Intrinsic Value
$84.43
Margin of safety
+2.1%
Expected annual return
+0.4%
Base case assumptions: 6.9% annual growth, 10.0% discount rate, 28x exit multiple, 5 year projection. Data as of 2026-06-12.
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 prominent global entity in the beverage sector, is dedicated to the creation, marketing, and worldwide sale of a broad spectrum of non-alcoholic refreshments. Its extensive product range encompasses effervescent soft drinks, including various flavored options; still and sparkling waters; sports beverages, coffees, and teas; diverse fruit juices; fortified dairy drinks; and plant-based alternatives, among other liquid offerings. In addition to finished products, the company provides beverage concentrates and syrups, specifically supplying fountain syrups to food service establishments like restaurants and convenience stores. These products are offered under an expansive portfolio of globally recognized brands, such as Coca-Cola, Diet Coke, Fanta, Sprite, Simply, Fresca, Powerade, Dasani, and Minute Maid, to name just a few. The organization leverages a sophisticated distribution network, involving independent bottling partners, a variety of distributors, wholesalers, and retailers, complemented by its own bottling and distribution operations. Established in 1886, the enterprise's central operations are based in Atlanta, Georgia.
Financial Metrics — KO Stock Valuation Data
Revenue/Share (TTM)
$11.46
FCF/Share (TTM)
$2.92
ROIC (TTM)
13.9%
ROE (TTM)
43.6%
P/FCF
28.3x
EV/EBITDA
20.2x
FCF Yield
3.53%
Debt/Equity
1.30x
Based on trailing twelve-month data, KO shows a free cash flow per share of $2.92 and a ROIC of 13.9%, key inputs for stock valuation using the DCF method. The P/FCF ratio of 28.3x and FCF yield of 3.53% 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 $2.92 in free cash flow per share. At the current price of $82.62, 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 28.3x with a free cash flow yield of 3.53%. 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 ($2.92) 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 1.30x, 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 1.30x, the capital structure directly influences WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%. At an EV/EBITDA of 20.2x, 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 2026-06-12. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.