The Coca-Cola Company (KO)
Discount cash flow analysis
5% margin of safety What's this?
Price history
Sensitivity matrix
|
-1% |
Discount Rate % 0% |
1% |
||
|---|---|---|---|---|
| -1% | $51.89 | $51.06 | $50.25 | |
| Terminal Growth% | 0 | $52.22 | $51.38 | $50.56 |
| +1% | $52.55 | $51.70 | $50.87 |
How does a change in discount rate or terminal growth affect valuation?
This table shows the sensitivity of the valuation to two key variables - the discount rate and the terminal growth rate
Valuations and comments
- Valuecruncher created a new valuation of $51.89 (overvalued by 3.28%) - 5 hours ago
- kaykat created a new valuation of $56.46 (undervalued by 0.23%) - 2 months ago
- mislixue created a new valuation of $51.38 (overvalued by 8.82%) - 2 months ago
- mislixue created a new valuation of $51.38 (overvalued by 8.82%) - 2 months ago
- diegovillagran created a new valuation of $53.28 (overvalued by 8.8%) - 2 months ago
- GordonGekko created a new valuation of $51.86 (undervalued by 4.89%) - 7 months ago
- bigzippy created a new valuation of $68.43 (undervalued by 39.14%) - 8 months ago
- SethWellbourne created a new valuation of $31.24 (overvalued by 29.53%) - 10 months ago
- GordonGekko created a new valuation of $48.56 (undervalued by 7.86%) - 11 months ago
- gwallen created a new valuation of $52.67 (undervalued by 19.14%) - 11 months ago
- gwallen created a new valuation of $53.41 (undervalued by 20.81%) - 11 months ago
- SethWellbourne created a new valuation of $29.16 (overvalued by 33.61%) - 11 months ago
- Amer created a new valuation of $90.61 (undervalued by 117.55%) - 12 months ago
- dweis created a new valuation of $30.92 (overvalued by 28.9%) - 1 year ago
- TheCrunchBlog created a new valuation of $54.73 (undervalued by 5.11%) - 1 year ago
- howai88 created a new valuation of $62.23 (undervalued by 20.04%) - 1 year ago
- GordonGekko created a new valuation of $56.55 (overvalued by 0.84%) - 1 year ago
- Sam created a new valuation of $54.17 (overvalued by 10.24%) - 1 year ago
Comments
The boring details
| All amounts in millions | Figures |
| Enterprise Value: | 128,649 |
| Net Debt (Long-term borrowings less cash): | 4,333 |
| Equity Value: | 130,573 |
| Number of Shares Outstanding: | 2,317,000,000 |
| Calculated value per share: | $51.38 |
Enterprise Value is the present value of the post-tax cash flows for a business into the future.
Where:
- C1, C2, C3 - the cash flow in period 1, 2, 3, ...
- r - the discount rate
To capture the cash flows into the future a terminal value is calculated via a perpetuity calculation -
based on the final years forecast post-tax free cash flow.
Where:
- Cn - the cash flow in the final forecast period.
- LTG - the long-term growth rate
- r - the discount rate
- g - the terminal growth rate
The Capital Asset Pricing Model (CAPM) is used to determine the equity component in the discount rate.
Where:
- rt - the risk free rate
- t - the tax rate
- B - the beta of the company
- MRP - the Market Risk Premium
Valuecruncher uses an estimate of Weighted Average Cost of Capital (WACC) to determine the discount rate in the calculation.