Enterprise Value to FCFF (EV/FCFF)
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Coca-Cola Co. pages available for free this week:
- Balance Sheet: Assets
- Common-Size Income Statement
- Analysis of Profitability Ratios
- Analysis of Solvency Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Analysis of Geographic Areas
- Price to FCFE (P/FCFE)
- Present Value of Free Cash Flow to Equity (FCFE)
- Net Profit Margin since 2005
- Total Asset Turnover since 2005
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Free Cash Flow to The Firm (FCFF)
Coca-Cola Co., FCFF calculation
US$ in millions
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Net cash provided by operating activities
- The net cash generated from operating activities exhibited fluctuations over the five-year period. There was a notable increase from 9,844 million USD in 2020 to 12,625 million USD in 2021, marking a substantial improvement in cash generation capacity. However, this peak was followed by a decline to 11,018 million USD in 2022. The subsequent year saw a partial recovery to 11,599 million USD in 2023, but by 2024, there was a sharp decrease to 6,805 million USD, indicating reduced operational cash inflows relative to earlier years.
- Free cash flow to the firm (FCFF)
- The free cash flow to the firm mirrored the trend of operating cash flows with some variation. Starting at 9,601 million USD in 2020, it rose steadily to 11,948 million USD in 2021, highlighting improved cash availability after necessary capital expenditures. Following this peak, FCFF decreased to 10,304 million USD in 2022, then saw a slight uptick to 10,990 million USD in 2023. In 2024, the free cash flow notably declined to 6,140 million USD, reflecting a downward trend consistent with the diminished net operating cash flows.
- Overall cash flow trends
- Both operating cash flow and free cash flow to the firm demonstrated a general upward trend from 2020 to 2021, followed by volatility and declines through 2024. The sharp drop in 2024 for both measures may suggest operational challenges, increased cash outflows, or investment activities impacting liquidity. The decrease in free cash flow to the firm corresponding with operating cash flow reduction emphasizes tightened cash availability post capital investments.
Interest Paid, Net of Tax
Coca-Cola Co., interest paid, net of tax calculation
US$ in millions
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
2 2024 Calculation
Interest paid, tax = Interest paid × EITR
= × =
- Effective Income Tax Rate (EITR)
- The effective income tax rate demonstrated a fluctuating but generally downward trend from 2020 through 2023, starting at 20.3% in 2020 and declining to 17.4% in 2023. This represents a decrease of 2.9 percentage points over four years. However, in 2024, the rate increased slightly to 18.6%, indicating a minor reversal after the prior reduction. Overall, the effective income tax rate shows variability within a relatively narrow range between 17.4% and 21.1%, suggesting some changes in tax conditions or company tax strategies during these years.
- Interest Paid, Net of Tax
- The interest paid on a net-of-tax basis in millions of US dollars shows a mixed pattern with an overall upward trend. In 2020, the interest paid was $745 million, after which it declined to $582 million in 2021, marking a significant decrease. However, from 2021 onwards, there is a noticeable increase. The amount rose to $695 million in 2022, then sharply increased to $1,169 million in 2023, and further to $1,359 million in 2024. This progression from 2021 to 2024 represents more than a twofold increase in interest expenses, which could reflect higher debt levels, increased borrowing costs, or changes in financial strategy during the period.
Enterprise Value to FCFF Ratio, Current
Coca-Cola Co., current EV/FCFF calculation, comparison to benchmarks
| Selected Financial Data (US$ in millions) | |
| Enterprise value (EV) | |
| Free cash flow to the firm (FCFF) | |
| Valuation Ratio | |
| EV/FCFF | |
| Benchmarks | |
| EV/FCFF, Competitors1 | |
| Mondelēz International Inc. | |
| PepsiCo Inc. | |
| Philip Morris International Inc. | |
| EV/FCFF, Sector | |
| Food, Beverage & Tobacco | |
| EV/FCFF, Industry | |
| Consumer Staples | |
Based on: 10-K (reporting date: 2024-12-31).
1 Click competitor name to see calculations.
If the company EV/FCFF is lower then the EV/FCFF of benchmark then company is relatively undervalued.
Otherwise, if the company EV/FCFF is higher then the EV/FCFF of benchmark then company is relatively overvalued.
Enterprise Value to FCFF Ratio, Historical
Coca-Cola Co., historical EV/FCFF calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Enterprise value (EV)1 | ||||||
| Free cash flow to the firm (FCFF)2 | ||||||
| Valuation Ratio | ||||||
| EV/FCFF3 | ||||||
| Benchmarks | ||||||
| EV/FCFF, Competitors4 | ||||||
| Mondelēz International Inc. | ||||||
| PepsiCo Inc. | ||||||
| Philip Morris International Inc. | ||||||
| EV/FCFF, Sector | ||||||
| Food, Beverage & Tobacco | ||||||
| EV/FCFF, Industry | ||||||
| Consumer Staples | ||||||
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
3 2024 Calculation
EV/FCFF = EV ÷ FCFF
= ÷ =
4 Click competitor name to see calculations.
The analysis of the financial data over the five-year period reveals several noteworthy trends in key valuation metrics.
- Enterprise Value (EV)
- The enterprise value exhibits an overall increasing trend from 2020 through 2024. Starting at $250,062 million in 2020, EV rose steadily, peaking at $332,709 million in 2024. Notably, there was a slight decline from 2021 to 2022, followed by gradual growth in the subsequent years, indicating a generally positive market valuation with some short-term fluctuations.
- Free Cash Flow to the Firm (FCFF)
- Free cash flow to the firm shows variability throughout the period. It increased from $9,601 million in 2020 to a peak of $11,948 million in 2021. However, after this peak, there is a downward trend with a minor recovery in 2023, before sharply dropping to $6,140 million in 2024. This significant decrease in the most recent year suggests reduced cash-generating capability or increased cash outflows.
- EV/FCFF Ratio
- The ratio of enterprise value to free cash flow to the firm remained relatively stable around the mid-20s from 2020 to 2023, fluctuating between 25.28 and 27.95. This indicates that the company's valuation relative to its cash flow was consistent, reflecting stable market perceptions of its cash flow generation over these years. However, in 2024, this ratio more than doubled to 54.19, driven by a combination of increased enterprise value and significantly decreased free cash flow. This sharp increase could imply the market is valuing the company at a higher multiple of its free cash flow, which might be due to anticipated future growth or possibly overvaluation concerns.