The Coca-Cola Company (KO) Stock Analysis
Score ACompounder · Grade B · Bullish
$75.55
$72.94
-3.5%
8/10
B
Compounder
Investment Thesis
Good opportunity: Quality company with favorable asymmetry at 10.0:1.
For New Investors
Quantitative score: high
For Current Holders
Quantitative score: neutral
Buy if
- Price drops 15-20% (improves asymmetry)
- Bull scenario catalysts materialize
- Market-wide correction creates opportunity
Sell if
- Bear scenario triggers occur
- Quality metrics deteriorate (ROIC declining)
- Better alternatives emerge
Valuation
Fair Value estimate: $72.94 (-3.5%). Approximately at fair value.
PEG-Based EPS
$76.94
FCF DCF Model
$56.42
EV/EBITDA
$84.51
Blended Fair Value
$72.94
Confidence
High
Methods
PEG-Based EPS, FCF 2-Stage DCF, EV/EBITDA
Quality Analysis
87/120 points
Investable
ROE (3Y Avg)
41.6%
ROIC-WACC Spread
8.2%
D/E Ratio
1.4x
Current Ratio
1.5x
Interest Coverage
8x
FCF Positive Years
3/3
Quality Flags
- ROIC spread: 8.2pp (got 21/25 pts)
- Leverage: D/E 1.4x (1/15 pts)
Market Sentiment
Wall Street Consensus
$85.00
+12.5% Upside
23 analysts
Range: $81.00 — $88.00
Rating: Buy
Our model aligns with Wall Street consensus.
Trend & Technical
Price ($75.55) is 7.8% above SMA 200 ($70.11). Bullish trend confirmed.
Tech Score 73/100 — Strong technical setup. Trend, momentum, and positioning aligned bullish.
Risk & Reward
Asymmetry Ratio
10.00:1
Expected Return
+63.9%
Bull Upside
+106.0%
Bear Downside
-10.0%
Excellent asymmetry: >3:1 ratio. Upside significantly outweighs downside.
Verdict: Very Favorable
Scenario Analysis
Bear
Base
Bull
Buy Zone & Action Plan
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AI Executive Summary
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Technical Analysis
RSI, MACD, moving averages, trend signals, and momentum indicators.
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Frequently Asked Questions
What is the fair value of KO?
Based on our multi-method conviction analysis, the estimated fair value of The Coca-Cola Company (KO) is $72.94. This is calculated by blending PEG-Based EPS, FCF 2-Stage DCF, EV/EBITDA and applying a quality premium of 0% based on the company's fundamentals. The confidence level of this estimate is high.
Is KO a buy, sell, or hold?
KO currently has a BUY rating with a conviction score of 8/10. Good opportunity: Quality company with favorable asymmetry at 10.0:1. Quantitative score: high.
Is KO a high-quality stock?
The Coca-Cola Company has a quality grade of B (87/120 points), rated as Investable. Key metrics include ROE of 41.6%, ROIC-WACC spread of 8.2%, and D/E ratio of 1.4x.
What type of stock is KO?
KO is classified as a "compounder" in our framework. Mature growth: 3.9%, Large cap: $325.0B, Dividend paying: 2.7%, High ROE (compounder): 44.4%, Consistent FCF: 3/3 years positive
What do Wall Street analysts say about KO?
23 Wall Street analysts have a consensus price target of $85.00 for KO, representing +12.5% upside. Targets range from $81.00 to $88.00. The consensus recommendation is "Buy". Our model aligns with Wall Street consensus.
What are the risks of investing in KO?
The risk/reward asymmetry ratio for KO is 10.00:1, rated as Very Favorable. Excellent asymmetry: >3:1 ratio. Upside significantly outweighs downside. The expected return is +63.9%, with bull case upside of +106.0% and bear case downside of -10.0%.
What is the current trend for KO?
KO is in a bullish trend. Price ($75.55) is 7.8% above SMA 200 ($70.11). Bullish trend confirmed. The technical score is 73/100.
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Last updated: March 20, 2026 · Framework version 3.7
This analysis is for informational purposes only and should not be considered financial advice. Always do your own research before making investment decisions.