The Coca-Cola Company - Company Evaluation and Analysis
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Transcript of The Coca-Cola Company - Company Evaluation and Analysis
Proudly Presented by:Chee Zhong Xian, Han Chuin Chi, Kenneth Ho, Jodie Wong, Peh Yong Sheng
Finance Group Project
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CompetitorComparisons
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Introduction
Peer Competitors
Stock Analysis
Beta Analysis
Conclusion
OUR SCOPE
1What was Coca Cola first sold as?a) A sleeping draughtb) A nerve and brain tonicc) A hang-over cured) Poison
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
IT’S TRIVIA TIME!
1What was Coca Cola first sold as?a) A sleeping draughtb) A nerve and brain tonicc) A hang-over cured) Poison
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
IT’S TRIVIA TIME!
Company Background
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Peer Competitors
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Beverages BeveragesBeverages & Snacks
40% Market Share
30% Market Share
16% Market Share
2012 revenues $48.0B USD
+3.2% above 2011 results.
2012 revenues $65.5B USD
-1.5% below 2011 results.
2012 revenues $6.0B USD
+1.6% above 2011 results.
2IT’S TRIVIA TIME!
What does the name "Coca Cola" mean in Chinese?a) Cold and freezingb) Happiness and Blissc) Cold and thirstyd) To make mouth happy
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
2IT’S TRIVIA TIME!
What does the name "Coca Cola" mean in Chinese?a) Cold and freezingb) Happiness and Blissc) Cold and thirstyd) To make mouth happy
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Analysis of Historical Stock Prices (Coca-Cola)
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Analysis of Historical Stock Price (KO)
US$52.65
US$86.10
150% Increase
Average Monthly Returns = 0.88%
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
US$26.32
US$43.05
Average Monthly Returns = 0.88%
150% Increase
Analysis of Historical Stock Price (KO)
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
1. Election of 2 Board Officers
2. Lehman Brother’s Bankruptcy (Subprime crisis) & Recession
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Analysis of Historical Stock Price (KO)
Analysis of Historical Stock Price (KO)
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Analysis of Historical Stock Price (KO)
1. Attempted hack into Coca Cola’s computer
systems
2. Debut of “PlantBottle” & Recovery
Analysis of Historical Stock Price (KO)
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Analysis of Historical Stock Price (KO)
1. Deal signed with Sony to promote PlayStation Move
3IT’S TRIVIA TIME!
How long has Coca-Cola been around?a) 127 Yearsb) 200 Yearsc) 900 Monthsd) 6300 Days
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
3IT’S TRIVIA TIME!
How long has Coca-Cola been around?a) 127 Yearsb) 200 Yearsc) 900 Monthsd) 6300 Days
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Analysis of Historical Stock Price (KO)
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Analysis of Historical Stock Price (KO)
1. Coca-Cola’s constant investment in China
Analysis of Historical Stock Price (KO)
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Analysis of Historical Stock Price (KO)
1. Make known intention to venture into Myanmar
2. Announcement of Stock Split
Analysis of Historical Stock Price (KO)
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Analysis of Historical Stock Price (KO)
1. Coca-Cola takes active role in global obesity
problem
2. Mexico imposes tax on Junk Food
4IT’S TRIVIA TIME!
How long would it take for you to try all the beverages made by Coca Cola if you drank one per day?a) 3 monthsb) 9 Yearsc) 25 daysd) 3 years
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
4IT’S TRIVIA TIME!
How long would it take for you to try all the beverages made by Coca Cola if you drank one per day?a) 3 monthsb) 9 Yearsc) 25 daysd) 3 years
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Comparison of Coca-Cola with Peers
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Coca-Cola (KO) & Dr Pepper Snapple Group (DPS)
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
KO stock prices have risen close to 170%
DPS stock prices have risen close to 209%
Analysis of Coca-Cola vs Dr Pepper Snapple Stock prices
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
1 Investors have strong confidence in DPS.
2 DPS was more badly affected by the 2008 financial crisis than KO.
Very sharp jumps in DPS’ stock price in 2010.3
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Coca-Cola (KO) & PepsiCo (PEP)
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
This signals strong performance of both companies with an increase of share price.
Coca-Cola (KO) & PepsiCo (PEP)
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Trend diverges in Q3 2013
PEP achieving a lead of 10% as compared to KO
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Analysis of Coca-Cola vs PepsiCo Stock prices
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Counters shift towards healthier drinks with diversification to food products.
Expanded distribution in China and did aggressive marketing by employing Chinese artiste ambassadors.
Research centre to develop new products and tailor products to Asian preferences.
5IT’S TRIVIA TIME!
Which is the second most widely understood term in the world?a) okb) yesc) Coca Colad) hello
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
5Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
IT’S TRIVIA TIME!
Which is the second most widely understood term in the world?a) okb) yesc) Coca Colad) hello
Beta Analysis
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Beta Analysis
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Coca-Cola Dr Pepper Snapple Group
PepsiCo
0.4149 0.6816 0.3906
Middle Highest Lowest
Moderate systematic risk (relative)
Largest systematic risk
Smallest systematic risk
Stable and with little fluctuations
Steeper stock price drop during recession
Attractive to conservative
investors
β
Conclusion
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
Introduction Peer Competitors Stock Analysis Competitor Comparisons Beta Analysis Conclusion
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CONCLUSIONCoca-Cola is a stable company and is less prone to systematic risk.
2 PepsiCo is a strong rival with a more diversified portfolio, popular with the new generation.
3 Dr Pepper Snapple Group offers healthier choices and is growing strong.
Coca-Cola must keep up with market trends & stay above the competition for investors to
have more confidence in its stocks.
Chee Zhong Xian, Han Chuin Chi, Kenneth Ho, Jodie Wong,
Peh Yong Sheng
Thank You