INVESTMENT
ADVICE
&
PORTFOLIO
MANAGEMENT
CLIENT: MR. M. SCHAUTEN
11TH MARCH 2022
CONSULTED BY:
BETA
AIMÉE DIDERICH ASSET
MAI MARIKA KUBISOVA
SIDDHANT SONI MANAGEMENT
, OVERVIEW
This report provides advice for potential investment in The Coca-Cola Company's (NYSE: KO) stock
through analysis of its corporate performance with respect to its competitors, assessment of market
developments, and evaluation of its current stock price through the dividend discount model (DDM).
Ultimately, our analysis suggests that the stock is fairly priced, and thus must be held.
The Coca-Cola Company – established in 1892 – is a pioneering leader in the beverages industry with
operations in ≈200 countries. Its product portfolio, with more than 3500 beverages marketed through
500 brands, has consistently managed to penetrate several consumer segment and instilled sticky
brand loyalty amongst them through creating targeted, differentiated products. In terms of its business
activity, The Coca-Cola Company’s operations – from manufacturing to marketing – are horizontally
integrated within the company, allowing for greater competitiveness. (Coca Cola, 2021)
Within the extremely competitive soft beverages market, Coca-Cola faces closest competition from
Pepsi Co. and Keurig Dr. Pepper (KDP) as identified by our peer analysis (Eikon, 2022). Pepsi roughly
operates on the same scale as Coca-Cola in terms of its geographic scope and operations but is more
horizontally integrated within the FMCG industry through its subsidiaries such as Lays. KDP, on the
other hand, is integrated limitedly and has a narrower product portfolio. Particularly, for our analysis,
Pepsi, and KDP will be taken as benchmarks.
Figure 1 below depicts the evolution of the daily stock prices of the three companies in discussion
along with Figure 2 which represents the S&P500 index of the food and beverage industry group and
indicates volatility of the food and beverage industry and its value. Coca-Cola, Pepsi, and KDP are all
included in the S&P500 food and beverages industry group.
F igur e 1 :
ADVICE
&
PORTFOLIO
MANAGEMENT
CLIENT: MR. M. SCHAUTEN
11TH MARCH 2022
CONSULTED BY:
BETA
AIMÉE DIDERICH ASSET
MAI MARIKA KUBISOVA
SIDDHANT SONI MANAGEMENT
, OVERVIEW
This report provides advice for potential investment in The Coca-Cola Company's (NYSE: KO) stock
through analysis of its corporate performance with respect to its competitors, assessment of market
developments, and evaluation of its current stock price through the dividend discount model (DDM).
Ultimately, our analysis suggests that the stock is fairly priced, and thus must be held.
The Coca-Cola Company – established in 1892 – is a pioneering leader in the beverages industry with
operations in ≈200 countries. Its product portfolio, with more than 3500 beverages marketed through
500 brands, has consistently managed to penetrate several consumer segment and instilled sticky
brand loyalty amongst them through creating targeted, differentiated products. In terms of its business
activity, The Coca-Cola Company’s operations – from manufacturing to marketing – are horizontally
integrated within the company, allowing for greater competitiveness. (Coca Cola, 2021)
Within the extremely competitive soft beverages market, Coca-Cola faces closest competition from
Pepsi Co. and Keurig Dr. Pepper (KDP) as identified by our peer analysis (Eikon, 2022). Pepsi roughly
operates on the same scale as Coca-Cola in terms of its geographic scope and operations but is more
horizontally integrated within the FMCG industry through its subsidiaries such as Lays. KDP, on the
other hand, is integrated limitedly and has a narrower product portfolio. Particularly, for our analysis,
Pepsi, and KDP will be taken as benchmarks.
Figure 1 below depicts the evolution of the daily stock prices of the three companies in discussion
along with Figure 2 which represents the S&P500 index of the food and beverage industry group and
indicates volatility of the food and beverage industry and its value. Coca-Cola, Pepsi, and KDP are all
included in the S&P500 food and beverages industry group.
F igur e 1 :
