Coca Cola Co (NYSE:KO)

CAPS Rating: 4 out of 5

The world's leading soft-drink company, Coca-Cola's fountain includes everything from Coke to Poweraid to Dasani water.

Recs

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Player Avatar JohnCLeven (76.22) Submitted: 11/9/2012 10:19:43 AM : Outperform Start Price: $33.96 KO Score: -25.46

Buying KO on weakness has been a pretty successful strategy since 1892.

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Member Avatar JohnCLeven (76.22) Submitted: 11/12/2012 9:45:49 PM
Recs: 0

Experimental DCF shows $43 value, $35 with 20% margin of safety. Assumptions are 20% returns on capital and 7.5% WACC, based on 5 yr averages. This is one of my first attempts at calculating WACC by hand and using that as the discount rate. Also took 5 yr avg ROIC of 20% - 7.5% WACC to get a 12.5% growth rate, which I rounded down to 12%.

Member Avatar JohnCLeven (76.22) Submitted: 6/13/2013 3:43:26 PM
Recs: 1

I've read a few pretty good articles stating that WACC should NOT be used as the discount rate.

So take those previous numbers with a grain of salt. I am NOT overly confident in them.

KO is an epic company however, and it's not a bad buy if bought at a reasonable price.

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