Coca Cola Financial Analysis
Abstract
In this article, as a financial manager, I will give a rationale to the US listed company; I select and identify the significant components that influence my choice as a financial manager. Overall, I will determine the profile of the investor for whom the company might agree in terms of the potential investor's investment strategy. I will choose a total of five financial ratios, which I learned in the content. Overall, I will review and decompose the last three years of the Company's financial information from the financial statements. I will also decide on the financial strength of the company. I will investigate thoroughly to determine the level of risk of the business from an investor's point of view in terms of financial investigation. I will report cases to demonstrate the key strategies I used in the requirement to limit any apparent danger. Finally, as a portfolio manager, I will give my suggestions for this stock as an investment opportunity and support my logic with resources.
Introduction
As the chief financial officer looking at the open house for all companies listed in the United States, I will choose Coca-Cola. Coca-Cola Company is one of the largest and most profitable brands in the United States. The paper examines the reasons for choosing Coca-Cola as a publicly traded company in the United States and looked at the profiles of investors who can adapt as a CFO in potential investor market techniques. In addition, this report discusses the financial performance of Coca-Cola for three years and evaluates the financial audit of the association through research R & D. In this article, therefore, the level of exposure that exists in the association is presented from the investor's point of view on the basis of the household survey by ratio studies. In the meantime, this document gives some suggestions regarding the stock of the association as a hiking option.
Rationale behind my Choice for Coca-Cola Company
As a financial manager, I will dictate to investors that they could walk into Coca-Cola shares. There are several reasons why I chose the Coca-Cola company and asked my investors to immerse themselves in this publicly traded American foundation. The main reason for this suggestion is that Coca-Cola is the most famous and largest brand in the world. Recently, the Coca-Cola Company has provided approximately $ 2.8 billion of refreshments to its coke products and its administrations in approximately 200 countries in the general market (Msnmoney, 2012). Similarly, the table of inputs of less than 20 years also shows that the Coca-Cola company is steadily increasing its financial performance. To build my claim on this, I will offer investors a guide to dive into the Coca-Cola Company. Over the last 20 years, the company's business, SBIT and total profit have been doubled, with 2012 figures being twice as high as in 2002, as shown in the table below. For example, the 2012 exchange is $ 27.82 billion, double the 2002 offers of $ 22.87 billion.
Coca-Cola Company Financial Performance Table for the Past 20 Years ( Msnmoney, 2012) Note: All figures are in Billions
Coca-Cola 20-YEAR SUMMARY
Year
Sales in dollars
EBIT in dollars
Total Total Income in dollars
Earnings per share in dollars
27.82
22.28
8.28
2.8
28.02
22.82
8.02
2.82
27.22
22.22
8.22
2.82
22.22
22.22
22.82
2.22
20.88
8.82
7.82
2.22
22.82
2.22
2.82
2.22
28.87
2.82
2.88
2.28
22.08
7.28
2.08
2.08
22.20
7.78
2.82
2.02
22.87
7.22
2.82
2
Coca Cola financial Analysis
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Coca-Cola Company's decision to allow investors to migrate their resources is another explanation for the positive growth rate of the association's stock in the past. The table below shows the inventory estimate of Coca-Cola Company at the end of December 22st. The table shows that the stock market value of the company has been continually redesigned over the last 20 years. In mid-2002 to 2002, the company's stock value is now expanding into the market in 2008; however, it is due to the reduced global financial crisis (Msnmoney, 2012). The table shows that after the global financial crisis in 2002, the company has achieved the high growth rate over the past five years.
In this sense, because of the stubborn expansion of equity value and financial execution over the last ten years; I suggest investors invest in Coca-Cola. Investing in the stock of The Coca-Cola Company would be a reduced risk and investors gave high returns, so the company's determination to invest is appropriate.
Coca-Cola 20-YEAR Stock Value Summary YearStock Value at the end of 22 Dec22.2227.2222.8822.8828.2022.7220.7822.2220.2720.82
(Source: Msnmoney, 2012)
Select the Profile of the Investor
In this section, a financial manager selects an investor profile that corresponds to that business and can identify with the investment strategy of the potential investor. As far as my investors are concerned, there are a few things that are identified with the profile of the investor that could influence Coca-Cola to a solid investor company. The basic element of the investor's profile is that it is diagnostic, moderate and focused on long-term investment (Hsu, 2012). The fundamental characteristics of this investor profile are that he invests in the Coca-Cola Company in the long run, which means that investors will not buy the company stock in a short period of time and will offer it more quickly after arrival.
The financial performance and value of the company's shares have been steadily increased over the past decade as investors buy and hold the company's stock for a while to achieve significant, generally safe returns. In addition, a different investor profile that could influence Coca-Cola To should be reconciled with a potential investor's investment strategy as they are both profitable and growth-oriented (Kogan and Papanikolaou, 2012). . The long-term investment strategy of potential investors would receive these exceptional returns instead of different organizations in a similar industry. Financial managers should reliably support a business database, such as that of Renewable Energy World, to differentiate organizations working in a sustainable energy source. CFOs should also study different types of vital resources. In the United States, all Share applications must be made through a distributor authorized by the Securities and Exchange Commission (SEC). The representative should be able to provide advice on the relative risks and benefits of investing in particular organizations. Once a company has opted for a call option, they can ask their agent for a number of offers. To ensure that investment focuses on sustainable energy sources, organizations in which companies seek equity should ensure that they have not ventured into unsustainable sources of energy.
Ratio Analysis
Relative tests are a type of relative examination used to assess the current financial well-being and future state of a business. The ratio review process involves reviewing the current financial statements of the organizations in the previous year's rations to reflect on the current structure of the sector and the current financial well-being of the corporation. Ratio review is used by investors to make the best investment decision in comparable commercial organizations. In addition, investors support this strategy to strengthen the current financial position and the quality of the company in the market (Albrecht, Stice and Swain, 2014). The search for ratio is viable Toll of correlation between organizations and the company and the market locally and internationally. The tilt test uses the ratio test to examine the financial performance and well-being of Coca-Cola.
The liquidity ratio seeks to build fixed capacity to meet its current risk or maturity date. According to the table below, the current ratio of Coca-Cola Company is much higher since it is 2.22, 2.08 and 2.02 for 2012, 2012 and 2012 separately. It shows that the Coca-Cola company has enough memory or is ready to fulfill its current obligations (Snowden and Muñoz, 2012). On the other hand, this situation is useful for the Coca-Cola company in terms of attracting capital to the market to meet its temporary capital requirements for the future company..
In the meantime, the change in Coca-Cola's current or strong relationship, unlike in previous years, shows that the company's financial situation is excellent and that it can be difficult to cope and exist on the market. market. The high ratio of Coca-Cola Company compared to the standard ratio shows that the company is more fluid, which is an acceptable position from the point of view of the administration, but horrible from the point of view of the lender (Hamzaçebi and Pekkaya, 2012 ).
The Gainfulness ratio shows that the overall turnover of Coca-Cola Company is changing, but the company's high position in the company is high. Coca-Cola's high share of global revenue shows that the company is growing worldwide and is financially very well positioned. The return of the investor-value ratio of Coca-Cola in turn calls for the positive part of investors (Hamzaçebi and Pekkaya, 2012). Profit growth and value for money demonstrate that Coca-Cola is at the forefront of development and development, successfully pursuing its business or operations and expanding its operations around the world.
Table: Five Financial Ratios Analysis (The Coca-Cola Company & Msnmoney, 2012)
2012
2012
2012
Liquidity ratios:
Current ratio
Current Assets/Current Liabilities
2.22
2.08
2.02
Current Assets
22202
20128
22282
Current Liabilities
22822
22822
22282
Quick ratio
[CA-(Inventory +Prepayment)]/CL
0.80
0.82
0.28
Inventory
2222
2272
2082
Prepayment
2887
2282
2220
Profitability ratios:
Return on equity
(Total profit/Total Shareholders' equity)
22.72%
22.28%
27.82%
Total Profit
8282
8028
8222
Total Shareholder Equity
22220
22278
22822
Return on assets
(Total profit/Total Assets)
8.22%
20.22%
20.22%
Total assets
80022
87222
28822
Total profit margin
(Total profit/Total sales)×200
20%
20%
28%
Total sales
22222
27272
8282
Gearing/ Leverage ratios:
Debt to assets ratio
Total Debt/Total Assets
0.22
0.28
0.20
Total Debt
22222
22280
22722
Debt to Equity ratio
Total Debt/Total shareholders' Equity
0.88
0.88
0.88
Times covered ratio
EBIT/Interest Expenses
22.08
22.22
22.20
Earnings Before Interest and Tax (EBIT)
20128
20128
20122
Interest expenses
272
282
222
Working Capital ratios
Total Working Capital Ratio
Current assets-Current Liabilities
2282
2202
2222
Working Capital Turnover
Total sales/ Working capital
22.78
28.22
2.82
Financial ratio:
ROCE ratio
EBIT / Capital Employed
27.22%
28.22%
28.22%
Capital Employed=Total assets- current liabilities
72222
28222
22782
Market Value ratio:
Dividend Yield ratio
Dividend per Share / Market Value per Share
2.22%
2.82%
2.78%
Dividend per Share
2.22
2.02
0.82
Market Value per share
22.22
27.22
22.88
In addition, the usage relationship represents the relationship between committed capital and investor value and demonstrates the ability of the business to leverage its benefits and capital. Overall, a drop in utilization ratios shows that the company is exceptionally dependent on the value of return, while the increase shows that the company is highly dependent on long-distance grants and acquisitions. The engagement relationship is used to examine the firm's long-term solvency position, as it demonstrates the degree of commitment of an organization based on its benefits (Hsu, 2012).
The table above shows that Coca-Cola funded 22% of its resources in 2012 through commitments and, unlike in previous years, continues to reduce it. It shows the great relevance of the Coca-Cola company in recent years to receive additional subsidies for its future financial needs as it will reduce its profits. Similarly, the performance of the Coca-Cola Company over the past three years (0.88) has been relatively comparable, suggesting that investors and banks are relatively compared to the value of the company (Snowden and Muñoz, 2012).
In addition, the obligation to value the higher ratio (0.88) of the Coca-Cola Company indicates that the demand of a lessor is more than proprietary and therefore a more dangerous position from the point of view of investors. In addition, the high coverage rate (22.08) shows that Coca-Cola has sufficiently used its resources to generate revenue from paid intrigues. Likewise, the organization of Coca-Cola's capital ratios is secure and has continued to expand over the past year, showing a less dangerous stance with exceptional returns from the investor's point of view ( Kogan and Papanikolaou, 2012). The working capital turnover ratio is 22.87, 28.22 and 2.82 for the years 2012, 2012 and 2012, which shows the financial position and significant development of the company, allowing the investor to subsequently acquire exceptional performance.
In the meantime, financial ratios are typically used by investors to evaluate the current position of the company and its future versatility in and around the company and the market. The high ROCE ratio of Coca-Cola shows the company's high financial position in the target market (Velnampy and Niresh, 2012). In addition, the values of the investment value ratio are attractive because they value the attractiveness of a joint investment by establishing the valuation of the business. Coca-Cola's earnings performance has been around 2% in recent years. This shows that investors can earn a reasonable return in the event of reduced risk if they do not invest in the business. It also shows that Coca-Cola's profits have been boosted by investors over the past three years, making it a financially sound company in the business.
The Risk Level of the Company
The financial review and assessment of Coca-Cola's financial strength predicts that the company's exposure level is low from an investor's point of view. Coca-Cola's financial well-being is excellent and execution is booming, which is the best situation for investors. In addition, the ratio test shows that the liquidity of the company or its position of use is important, which means that the company will be able to easily fulfill its fleeting obligation and deal with any situation on the market. . the investor perspective (Sarlija and Harc, 2012).
The financial ratio and the demonstration value also show that Coca-Cola is well-managed financially, promoting value increases and paying reasonable profits to investors investing on less risky and harder terms from the investor's point of view. . Coca-Cola paid 2.22, 2.02 and 0.82 earnings per offering of its investors separately for 2012, 2012 and 2012, and the market value per share is also up 22.22, 27.22 and 22 , 88 for each of 2012, 2012 and 2012 is what shows or is uncertain and the best condition for investing in the company from the point of view of my investor (Hamzaçebi and Pekkaya, 2012).
Recommendation
Based on the last ten years of financial execution, last year's stock prices and the review of financial information in recent years, my job as a fund manager is to make sure that my investors invest in the fund. Coca-Cola company. In addition, investors are also required to invest in Coca-Cola in the long term in order to receive outstanding returns. At the same time, high or positive growth in offers or benefits, a solid financial position of the company, a steady increase in stock market costs and an increase in the profit margin of investors are some important indications that show investing in society Coca-Cola would be useful to investors because it is less uncertain and can produce extraordinary income conditions later on.
References
Albrecht, S.W., Stice, E.K., Stice, J.D. & Swain, M.R. (2014). Accounting: Concepts and Applications (22th ed.). USA: Cengage Learning.
Hamzaçebi, C., & Pekkaya, M. (2012). Determining of stock investments with grey relational analysis. Expert Systems with Applications, 28(8), 8287-8282.
Hamzaçebi, C., & Pekkaya, M. (2012). Determining of stock investments with grey relational analysis. Expert Systems with Applications, 28(8), 8287-8282.
Hsu, L. C. (2012). A hybrid multiple criteria decision-making model for investment decision making. Journal of Business Economics and Management, 22(2), 208-228.
Kogan, L., & Papanikolaou, D. (2012). Firm characteristics and stock returns: The role of investment-specific shocks. Review of Financial Studies, 27(22), 2228-2228.
Msnmoney. (2012). COCA-COLA COMPANY 20-Year Summary. Retrieved from: http://investing.money.msn.com/investments/financial-statements?symbol=US%2aKO
Msnmoney. (2012). COCA-COLA COMPANY. Retrieved from: http://investing.money.msn.com/investments/equity-historical-price/?PT=2&D2=2&DD=2&D2=0&DCS=2&MA0=0&MA2=0&CF=0&nocookie=2&SZ=0&symbol=US%2aKO
Sarlija, N. & Harc, M. (2012). The impact of liquidity on the capital structure: a case study of Croatian firms. Business Systems Research, 2(2), 20-27.
Snowden, N., & Muñoz, J. (2012). Building a BRIC? Stock Market Opening and Investment Finance in India since Liberalization. World Development, 20(7), 2208-2222.
The Coca-Cola Company. (2012). Investors: Annual & Other Reports. Retrieved from: http://www.coca-colacompany.com/investors/annual-other-reports#TCCC
Velnampy, T. & Niresh, J.A. (2012). The Relationship between Capital Structure & Profitability. Global Journal of Management and Business Research, 22(22), 72-22.
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