KO
KO
Trim 2026-04-18
Model
DDM
Price at Report
$75.74
Base IV
$54.85
Bear IV
$44.28
Bull IV
$67.64
Entry Zone: 42-50 · Sell Above: 77
Bore Family Office
Valuation Report — The Coca-Cola Company (KO) • April 18, 2026
3-Stage DDM (Ke) • Discount Rate: 7.00% • Current Price: $75.74
Prepared by Lurch • Bore Family Office • Data: Finnhub, StockAnalysis.com, S&P Global Market Intelligence
🏢 Business Overview
The Coca-Cola Company is a global beverage leader with iconic brands including Coke, Diet Coke, Sprite, and Fanta. The company operates a franchise model with bottling partners, generating licensing fees and concentrate sales. KO has a 64-year dividend growth streak and a highly efficient, asset-light business model.
Management focuses on portfolio optimization, pricing power, and share buybacks. The company is navigating volume challenges in mature markets while investing in growth categories like sparkling water, coffee, and sports drinks.
| Business Segment | Revenue | % of Total | YoY Growth | Margin | Notes |
|---|---|---|---|---|---|
| North America | $22,000M | 46% | +2.0% | — | Volume challenged, pricing strong |
| Europe | $9,500M | 20% | +1.0% | — | Stable, low growth |
| Latin America | $8,500M | 18% | +4.0% | — | Higher growth markets |
| Asia Pacific | $7,000M | 15% | +3.0% | — | Mixed performance |
| Blended Growth Rate | — | 100% | +2.3% | — | Weighted avg across segments |
📊 Business Lifecycle Stage
Stage 1
Startup
Startup
Stage 2
Hyper Growth
Hyper Growth
Stage 3
Self Funding
Self Funding
Stage 4
Operating Leverage
Operating Leverage
Stage 5
Capital Return
Capital Return
Stage 6
Decline
Decline
Stage 4 — Maturity/Growth: Revenue growing modestly with profits inflecting rapidly. The classic DCF sweet spot — FCF is reliable, growing, and well-anchored to analyst estimates.
Why this drives model selection: Classic DCF sweet spot — FCF inflecting and growing rapidly.
🔍 Quality Scorecard
| Metric | Value | Assessment |
|---|---|---|
| ROIC | 18.0% | ≥12% strong |
| FCF Margin | 11.1% | ≥10% strong |
| Debt / EBITDA | 2.7x | 2–4x moderate |
| Revenue Trend | Mixed | 3-year directional trend |
| FCF Margin Trend | Expanding | Directional margin trajectory |
| Analyst Revisions | Upward revisions | Last 90 days consensus direction |
✅ Quality profile supports the valuation
📊 Financial Snapshot
| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue ($M) | $38,655 | $43,004 | $45,754 | $47,061 | $47,941 |
| Rev YoY Growth | — | +11.3% | +6.4% | +2.9% | +1.9% |
| Gross Margin | 60.3% | 58.1% | 59.5% | 61.1% | 61.6% |
| EBITDA ($M) | $11,760 | $12,169 | $12,439 | $11,067 | $14,812 |
| EBITDA Margin | 30.4% | 28.3% | 27.2% | 23.5% | 30.9% |
| Operating Income ($M) | $10,308 | $10,909 | $11,311 | $9,992 | $13,762 |
| Operating Margin | 26.7% | 25.4% | 24.7% | 21.2% | 28.7% |
| Net Income ($M) | $9,771 | $9,542 | $10,714 | $10,631 | $13,107 |
| Net Margin | 25.3% | 22.2% | 23.4% | 22.6% | 27.3% |
| EPS (diluted) | $2.26 | $2.20 | $2.48 | $2.47 | $3.05 |
| Free Cash Flow ($M) | $11,258 | $9,534 | $9,747 | $4,741 | $5,296 |
| Annual DPS | $1.680 | $1.760 | $1.840 | $1.940 | $2.040 |
| Total Debt ($M) | $43,000 | $44,000 | $43,500 | $40,500 | $40,000 |
💹 Capital Return & Share Count Analysis
Net Share Change
-0.0% (2021→2025)
📉 Net reduction — buybacks exceed issuances
| Year | Diluted Shares (M) | YoY Change | Buyback Spend ($M) | Buyback Yield |
|---|---|---|---|---|
| 2021 | 4315.0M | — | $5,000 | 1.5% |
| 2022 | 4328.0M | +0.3% | $5,000 | 1.5% |
| 2023 | 4308.0M | -0.5% | $5,000 | 1.5% |
| 2024 | 4302.0M | -0.1% | $5,500 | 1.7% |
| 2025 | 4313.0M | +0.3% | $5,500 | 1.7% |
KO has maintained a $5B annual buyback program through 2026, with potential for acceleration. Share count stable around 4.3B.
📈 DDM Scenarios
$44
🔴 Bear
$55
📊 Base
$68
🚀 Bull
$75.74
Current Price
$83
Analyst Avg PT
| Scenario | Stage 1 (Yrs 1–5) | Stage 2 (Yrs 6–10) | Terminal g | Ke | Intrinsic Value | vs Price |
|---|---|---|---|---|---|---|
| 🔴 Bear | 3.0% | 2.5% | 2.0% | 7.00% | $44 | ▼41.5% |
| 📊 Base | 5.0% | 4.0% | 2.5% | 7.00% | $55 | ▼27.6% |
| 🚀 Bull | 7.0% | 5.0% | 3.0% | 7.00% | $68 | ▼10.7% |
📋 Full 10-Year Projection Tables
Bear Scenario
Stage 1: 3.0% | Stage 2: 2.5% | Terminal: 2.0%
| Period | Stage | DPS / Dist. | PV of DPS | Cumulative IV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $2.101 | $1.964 | $1.96 |
| Year 2 | Stage 1 | $2.164 | $1.890 | $3.85 |
| Year 3 | Stage 1 | $2.229 | $1.820 | $5.67 |
| Year 4 | Stage 1 | $2.296 | $1.752 | $7.43 |
| Year 5 | Stage 1 | $2.365 | $1.686 | $9.11 |
| Year 6 | Stage 2 | $2.424 | $1.615 | $10.73 |
| Year 7 | Stage 2 | $2.485 | $1.547 | $12.27 |
| Year 8 | Stage 2 | $2.547 | $1.482 | $13.76 |
| Year 9 | Stage 2 | $2.610 | $1.420 | $15.18 |
| Year 10 | Stage 2 | $2.676 | $1.360 | $16.54 |
| Terminal | — | TV=$54.58 | PV(TV)=$27.75 (63% of IV) | $44.28 |
| Intrinsic Value | — | — | PV(Divs) $16.54 + PV(TV) $27.75 | $44.28 |
How the price per share is derived: Each year's projected dividend is discounted back at Ke (7.00%) to get its present value. After Year 10, dividends are assumed to grow at the terminal rate (2.0%) in perpetuity — the Gordon Growth formula gives a terminal value of DPS11 / (Ke − gT) = $54.58. That terminal value is then discounted back 10 years to today's dollars (PV of TV = $27.75). Intrinsic value = PV of all dividends ($16.54) + PV of terminal value ($27.75) = $44.28 per share.
Base Scenario
Stage 1: 5.0% | Stage 2: 4.0% | Terminal: 2.5%
| Period | Stage | DPS / Dist. | PV of DPS | Cumulative IV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $2.142 | $2.002 | $2.00 |
| Year 2 | Stage 1 | $2.249 | $1.964 | $3.97 |
| Year 3 | Stage 1 | $2.362 | $1.928 | $5.89 |
| Year 4 | Stage 1 | $2.480 | $1.892 | $7.79 |
| Year 5 | Stage 1 | $2.604 | $1.856 | $9.64 |
| Year 6 | Stage 2 | $2.708 | $1.804 | $11.45 |
| Year 7 | Stage 2 | $2.816 | $1.754 | $13.20 |
| Year 8 | Stage 2 | $2.929 | $1.705 | $14.90 |
| Year 9 | Stage 2 | $3.046 | $1.657 | $16.56 |
| Year 10 | Stage 2 | $3.168 | $1.610 | $18.17 |
| Terminal | — | TV=$72.15 | PV(TV)=$36.68 (67% of IV) | $54.85 |
| Intrinsic Value | — | — | PV(Divs) $18.17 + PV(TV) $36.68 | $54.85 |
How the price per share is derived: Each year's projected dividend is discounted back at Ke (7.00%) to get its present value. After Year 10, dividends are assumed to grow at the terminal rate (2.5%) in perpetuity — the Gordon Growth formula gives a terminal value of DPS11 / (Ke − gT) = $72.15. That terminal value is then discounted back 10 years to today's dollars (PV of TV = $36.68). Intrinsic value = PV of all dividends ($18.17) + PV of terminal value ($36.68) = $54.85 per share.
Bull Scenario
Stage 1: 7.0% | Stage 2: 5.0% | Terminal: 3.0%
| Period | Stage | DPS / Dist. | PV of DPS | Cumulative IV |
|---|---|---|---|---|
| Year 1 | Stage 1 | $2.183 | $2.040 | $2.04 |
| Year 2 | Stage 1 | $2.336 | $2.040 | $4.08 |
| Year 3 | Stage 1 | $2.499 | $2.040 | $6.12 |
| Year 4 | Stage 1 | $2.674 | $2.040 | $8.16 |
| Year 5 | Stage 1 | $2.861 | $2.040 | $10.20 |
| Year 6 | Stage 2 | $3.004 | $2.002 | $12.20 |
| Year 7 | Stage 2 | $3.154 | $1.964 | $14.17 |
| Year 8 | Stage 2 | $3.312 | $1.928 | $16.09 |
| Year 9 | Stage 2 | $3.478 | $1.892 | $17.99 |
| Year 10 | Stage 2 | $3.652 | $1.856 | $19.84 |
| Terminal | — | TV=$94.03 | PV(TV)=$47.80 (71% of IV) | $67.64 |
| Intrinsic Value | — | — | PV(Divs) $19.84 + PV(TV) $47.80 | $67.64 |
How the price per share is derived: Each year's projected dividend is discounted back at Ke (7.00%) to get its present value. After Year 10, dividends are assumed to grow at the terminal rate (3.0%) in perpetuity — the Gordon Growth formula gives a terminal value of DPS11 / (Ke − gT) = $94.03. That terminal value is then discounted back 10 years to today's dollars (PV of TV = $47.80). Intrinsic value = PV of all dividends ($19.84) + PV of terminal value ($47.80) = $67.64 per share.
🔲 Sensitivity Table
| Ke \ gT | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 5.0% | $77 | $86 | $100 | $120 | $154 |
| 5.5% | $67 | $74 | $83 | $96 | $116 |
| 6.0% | $59 | $64 | $71 | $80 | $92 |
| 6.5% | $53 | $57 | $62 | $68 | $77 |
| 7.0% | $48 | $51 | $55 | $60 | $66 |
| 7.5% | $44 | $46 | $49 | $53 | $57 |
| 8.0% | $40 | $42 | $45 | $48 | $51 |
| 8.5% | $37 | $39 | $41 | $43 | $46 |
| 9.0% | $35 | $36 | $38 | $39 | $42 |
Green = >10% above current price. Red = >10% below. Gold = within ±10%.
📉 Long-Term Price Trend Channel
Log-linear trend fitted to full price history. ±1.5σ bands. Green shaded zone = bottom 25% of historical range — historically attractive entry.
🏦 Comparable Valuation
| Company | Ticker | P/E | EV/EBITDA | P/FCF | Div Yield | Notes |
|---|---|---|---|---|---|---|
| PepsiCo | PEP | 24.5x | 14.2x | 20.0x | 2.8% | Closest peer |
| Coca-Cola | KO | 23.5x | 13.8x | 6.2x | 2.8% | Brand leader |
| Nestle | NSRGY | 22.0x | 12.5x | 18.0x | 2.5% | Global FMCG |
| Coca-Cola (own history 5-yr) | KO | 21.0x | 12.0x | 15.0x | 2.5% | 5-yr average multiples |
🔮 Analyst Forecast Section
(a) EPS Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2022 | $2.19 | — | — | — | Actual |
| 2023 | $2.48 | — | — | — | Actual |
| 2024 | $2.47 | — | — | — | Actual |
| 2025 | $3.05 | — | — | — | Actual |
| 2026 | $3.14 | $3.32 | $3.42 | 30 | Estimate |
| 2027 | $3.31 | $3.56 | $3.68 | 29 | Estimate |
(b) Revenue Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2022 | $43.0B | — | — | — | Actual |
| 2023 | $45.8B | — | — | — | Actual |
| 2024 | $47.1B | — | — | — | Actual |
| 2025 | $47.9B | — | — | — | Actual |
| 2026 | $47.0B | $50.5B | $52.0B | 30 | Estimate |
| 2027 | $47.6B | $51.4B | $53.8B | 29 | Estimate |
(c) Individual Analyst Price Targets
| Analyst | Firm | Rating | PT | Upside |
|---|---|---|---|---|
| Peter Grom | UBS | Strong Buy | $90 | +18.8% |
| Kaumil Gajrawala | Jefferies | Strong Buy | $90 | +18.8% |
| Steve Powers | Deutsche Bank | Strong Buy | $86 | +13.5% |
| Andrea Teixeira | JP Morgan | Buy | $83 | +9.6% |
| Lauren Lieberman | Barclays | Buy | $70 | -7.6% |
💡 Investment Thesis
- Dividend aristocrat with pricing power: 64-year dividend growth streak, 68% payout ratio leaves room for growth.
- Buyback potential: $5B+ annual buyback program, net debt reduced to $40B from $44B.
- Portfolio optimization: exited sparkling water joint venture, focused on core carbon drinks.
- Volume challenge: legacy markets flat-to-down, growth in emerging markets and new categories.
- Value at current price: 2.8% yield + 4-5% growth = 7-8% total return, competitive vs bonds.
👔 Management Quality & Culture
CEO: Not identified
Net Insider Buys (12m)
+581,531 shares
Incentive Alignment
❓ Unclear
Employee Ratings
Culture Signal
Mixed
Sources: Finnhub insider data · Brave Search (Glassdoor, Indeed, Comparably, news) · Earnings surprise data from analyst forecasts · Qualitative signals are directional only.
⚖️ DDM Verdict: Trim — The Coca-Cola Company (KO)
Current price: $75.74 | Analyst Avg PT: $83.20
$44
🔴 Bear
$55
📊 Base
$68
🚀 Bull
| Tier | Price | Action |
|---|---|---|
| Tier 1 — Starter | ≤$50 | Begin position |
| Tier 2 — Add | ≤$50 | Add on weakness |
| Tier 3 — Full | ≤$42 | Full allocation |
| Sell Alert | ≥$77 | Above fair value — consider trimming |
How tiers are set: Tier 1 = Base IV × 0.92 (8% discount to base case). Tier 2 = midpoint of Bear & Base IV (building on meaningful weakness). Tier 3 = Bear IV × 1.05 (just above worst-case — maximum margin of safety). Sell alert = Bull IV × 0.85 (15% discount to bull case — above fair value range).
Verdict: Trim. At $75.74, the shares are near or above the upper end of fair value. New buying is not attractive here, and risk/reward improves only on a pullback.
Bore Family Office • Analysis generated by Lurch • Not investment advice.
Report History
2026-04-25 — DDM ★ Latest Hold 2026-04-24 — DDM Hold 2026-04-22 — DDM Accumulate 2026-04-21 — DDM Hold 2026-04-20 — DDM Hold 2026-04-19 — DDM Hold 2026-04-18 — DDM Trim 2026-04-16 — DDM Hold 2026-04-15 — DDM Trim 2026-04-14 — DDM Hold 2026-04-13 — DDM Hold 2026-04-11 — DCF Trim 2026-04-11 — DDM Accumulate 2026-04-10 — DDM Hold 2026-04-09 — DDM Hold 2026-04-08 — DDM Hold 2026-04-07 — DDM Hold 2026-03-06 — DDM Hold