The non-cyclical nature of Coca-Cola's business has helped it survive the current environment. Adding this holding to your portfolio could be a good idea. Please read on.
shutterstock.com - StockNews The Coca-Cola Company has a market cap of $235.22 billion. It has sparkling soft drinks, sports drinks, juice, dairy, plant-based beverages, tea and coffee.
The company operates through a network of partners.
Warren Buffet believes in the value-based investing model and prefers companies with strong earnings power and immense potential for continued growth. He is a buy-and- hold investor and holds on to his stocks for a long time. The performance of the portfolio is considered a guide for several investors.
Even during an economic downturn, strong companies, such asKO, pay high dividends. He's held the stock for the longest time. Coca-Cola has a market value of about $24 billion, and is owned by Warren Buffet's company.
The company's financials were solid in the second quarter. The results reflect the agility of our business, the strength of our streamlined portfolio of brands, and the actions we have taken to execute for growth in the face of challenges.
The company pays attractive dividends. The current share price gives it a yield of 2.5%. The average dividend yield over the last four years was 3.05%. Over the past three years and the past five years, its dividends have gone up. The company's dividends have increased for 59 years in a row.
Over the past year, shares of the company have gained slightly.
In the upcoming months, here is what could have an impact.
The financials are solid.
Net operating revenues for the second quarter of the fiscal year were $11.33 billion. Its gross profit increased from a year ago. The company's operating income increased 8% year-over-year. The company's net income grew from the prior-year period.
The company's cash and cash equivalents came in at $8.98 billion, and its current assets were $23.14 billion. Cash flow from operating activities was $4.55 billion.
The analyst estimates are favorable.
The analysts expect the revenue for the fourth quarter to come in at $9.92 billion, an increase of 4.8% from the previous year. The estimate of the ongoing quarter's earnings per share indicates a year-over-year increase. In each of the last four quarters, the company has beaten the estimates.
Revenue and earnings per share are expected to grow in the current year. Revenue and earnings per share are expected to increase in the next year.
It's high profitability.
The industry average for gross profit margin is 32.63%. Its trailing-12-month margin is more than double that of the industry. The stock has a net income margin of 23.16% which is higher than the industry average.
The trailing-12-month FCF margin of 18.0% is 491% higher than the industry average. Its trailing-12-month ROCE, ROTC, and ROTA of 42.30%, 11.05%, and 10.87%, compare to the industry average of 12.21%, 6.17%, and 4.61%, respectively.
There is a consensus rating and price target.
Of the 15 Wall Street analysts that rated it, 12 gave it a rating of buy and three gave it a rating of hold. The 12-month median price target shows a potential upside. The price targets ranged from a low to a high.
The POWR ratings show promise.
A Buy in our POWR Ratings system is achieved by the B rating of KO. POWR ratings are calculated using 118 different factors and weighted to an optimal degree.
The B grade for Quality is consistent with the higher than industry profitability metrics. It has a B grade for stability The stability grade is justified by the stock's 0.61beta.
The A-rated beverages industry has 34 stocks.
We have given grades for sentiment, growth, value, and momentum as well. You can get access to all the ratings here.
The bottom line.
Brand building and innovation are combined in the growth strategy of the company. The focus is on enhancing shareholder value and building profit. The company pays dividends. One of the largest holdings in the portfolio is KO, which is owned by Warren Buffet.
We think it would be a good idea to add this holding to your portfolio because of the company's high profitability, promising growth prospects, and solid dividends.
How does Coca-Cola stack up against its competitors?
One can check out the other stocks in the Beverages industry with an A rating, such as Carlsberg A/S and Suntory Beverage & Food.
The shares rose in pre market trading. The benchmark S&P 500 index has risen over the course of the year, but KO has declined.
Her interest in the stock market led to her becoming a financial journalist. She looks to help retail investors understand the underlying factors before they make investment decisions.
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Is it possible to invest like Warren Buffet? The stock was bought first on Stock News.com.
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