Coca-Cola Company (The)

Methodology

Coca-Cola's global beverage business generates highly stable earnings from iconic brands with exceptional pricing power and distribution reach. The company's asset-light bottling model and brand strength create predictable cash flows. This calculation works very well given the recession-resistant nature of affordable beverages and consistent earnings growth from emerging market penetration and premiumization.

Methodology

Coca-Cola typically commands premium PEG ratios reflecting its defensive characteristics, brand strength, and dividend reliability despite modest growth. The company's pricing power and global reach justify higher multiples than typical consumer staples. Compare to Pepsi and other global beverage companies to assess whether Coca-Cola's brand portfolio and emerging market exposure warrant its valuation premium.

Methodology

Coca-Cola pays a substantial dividend with dividend aristocrat status and decades of consecutive increases. The company's consistent cash generation from beverage sales supports reliable dividend growth. PEGY is highly relevant for income investors seeking defensive characteristics, as the combination of yield and steady growth from pricing and volume creates the appeal of this beverage compounder.