Financial statement analysis and common stock valuation

Common Stock Valuation Ratios

Relative valuation technique determine the value of Coca-Cola Co. by comparing it to similar entities (like industry or sector) on the basis of several relative ratios that compare its stock price to relevant variables that affect the stock value, such as earnings, book value, and sales.

• Current Valuation Ratios
• Historical Valuation Ratios (Summary)
• Price to Earnings (P/E)
• Price to Operating Profit (P/OP)
• Price to Sales (P/S)
• Price to Book Value (P/BV)

DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin

An approach to decomposing Coca-Cola Co. return on equity, return on assets, and net profit margin ratio as the product of other financial ratios.

• Two-Component Disaggregation of ROE
• Three-Component Disaggregation of ROE
• Five-Component Disaggregation of ROE
• Two-Component Disaggregation of ROA
• Four-Component Disaggregation of ROA
• Disaggregation of Net Profit Margin

Enterprise Value to FCFF (EV/FCFF)

Free cash flow to the firm is the cash flow available to the Coca-Cola Co. suppliers of capital after all operating expenses have been paid and necessary investments in working and fixed capital have been made.

• Free Cash Flow to The Firm (FCFF)
• Interest Paid, Net of Tax
• EV to FCFF Ratio, Current
• EV to FCFF Ratio, Historical

Common-Size Balance Sheet: Liabilities and Stockholders’ Equity

Liabilities and stockholders’ equity components shown as percentage of total liabilities and stockholders’ equity.

Income Statement
Quarterly Data

The income statement (statement of earnings) reports on the performance of Coca-Cola Co., the result of its operating activities.

Analysis of Revenues

• Revenues as Reported

Statement of Comprehensive Income

Comprehensive income is the change in equity (net assets) of Coca-Cola Co. during a period from transactions and other events and circumstances from non-owners sources. It includes all changes in equity during a period except those resulting from investments by owners and distributions to owners.

Analysis of Solvency Ratios

Examines Coca-Cola Co. capital structure in terms of the mix of its financing sources and the ability of the firm to satisfy its longer-term debt and investment obligations.

• Solvency Ratios (Summary)
• Debt to Equity
• Debt to Equity (including Operating Lease Liability)
• Debt to Capital
• Debt to Capital (including Operating Lease Liability)
• Debt to Assets
• Debt to Assets (including Operating Lease Liability)
• Financial Leverage
• Interest Coverage
• Fixed Charge Coverage

Analysis of Long-term (Investment) Activity Ratios

Measures how efficiently Coca-Cola Co. generates revenues from its investments in fixed or total assets.

• Long-term Activity Ratios (Summary)
• Net Fixed Asset Turnover
• Net Fixed Asset Turnover (including Operating Lease, Right-of-Use Asset)
• Total Asset Turnover
• Equity Turnover

DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
Quarterly Data

An approach to decomposing Coca-Cola Co. return on equity, return on assets, and net profit margin ratio as the product of other financial ratios.

• Two-Component Disaggregation of ROE
• Three-Component Disaggregation of ROE
• Five-Component Disaggregation of ROE
• Two-Component Disaggregation of ROA
• Four-Component Disaggregation of ROA
• Disaggregation of Net Profit Margin

Income Statement

The income statement (statement of earnings) reports on the performance of Coca-Cola Co., the result of its operating activities.

Present Value of Free Cash Flow to Equity (FCFE)

The FCFE valuation approach estimates the value of equity as the present value of future FCFE discounted at the required rate of return on equity.

• Intrinsic Stock Value (Valuation Summary)
• Required Rate of Return (r)
• FCFE Growth Rate (g)