Financial statement analysis of coca cola company. Financial Analysis of Coca 2022-10-23
Financial statement analysis of coca cola company Rating:
Financial statement analysis is the process of examining a company's financial statements in order to understand its financial performance and position. It involves analyzing the income statement, balance sheet, and cash flow statement in order to understand the company's financial strengths and weaknesses, as well as its potential for future growth. One company that is well-known for its financial stability and performance is the Coca-Cola Company.
The income statement, also known as the profit and loss statement, shows a company's revenues and expenses over a specific period of time, usually a year. The net income, or profit, is the difference between the revenues and expenses. The Coca-Cola Company has consistently reported strong net income, with revenues of over $35 billion in 2020. This is due in part to the company's strong brand recognition and widespread distribution network, which allows it to sell its products in over 200 countries around the world.
The balance sheet is a snapshot of a company's financial position at a specific point in time. It shows the company's assets, liabilities, and equity. The Coca-Cola Company has a strong balance sheet, with a relatively low level of debt compared to its assets. This indicates that the company is financially stable and has a strong ability to pay off its debts. The company also has a large amount of cash and cash equivalents, which it can use for investments or to pay off debt.
The cash flow statement shows how a company generates and uses cash over a specific period of time. The Coca-Cola Company has consistently generated positive cash flow, meaning that it has more cash coming in than going out. This is important because it indicates that the company has the financial resources to invest in new projects or pay off debt.
Overall, the financial statements of the Coca-Cola Company indicate that it is a financially stable and successful company. It has strong revenues, a strong balance sheet, and consistently generates positive cash flow. These factors contribute to the company's ability to continue growing and expanding in the future.
In addition to analyzing the financial statements, investors and analysts also use financial ratios to evaluate a company's financial performance and position. Some commonly used financial ratios for the Coca-Cola Company include the price-to-earnings ratio, the debt-to-equity ratio, and the return on equity. All of these ratios are favorable for the Coca-Cola Company, indicating that it is a financially strong and attractive investment.
In conclusion, financial statement analysis is an important tool for understanding a company's financial performance and position. The Coca-Cola Company is a financially stable and successful company, with strong revenues, a strong balance sheet, and positive cash flow. Its favorable financial ratios also make it an attractive investment for investors and analysts.
Quick Ratio GuruFocus, 2020. Coca-Cola is a multinational marketer, retailer and manufacturer of soft, nonalcoholic beverages and syrups. During the 2009 pepsi had a better EPS in their statements. While this seems to be bad in coca cola ,the value seems to have increased to its maximum, but we can also see a drop in the prices of shre of Coca cola when compared to 2007 and 2009. My expectation is that coke profits would grow to 9 percent over the next five years ,but pepsico would grow at 11 percent ,which is behind the forcast. The fiscal end-year for the Coca-Cola Company end on the last day of December 31. If the raw material becomes more that is necessary for bottling then ,the bottler's would be forced to increase the prices to compensate.
Financial Statement Analysis of Coca Cola childhealthpolicy.vumc.org
A similar trend was observed in the value of debt to equity, which also increased until 2017 and then declined. The campaign succeeded in boosting Pepsi's status. Commodity Cost Fluctuations Affect Margins:. It is recommended that the company should invest in developing a separate entity to sell healthy products such as fresh juices and other soft drinks without soda. It reflects a very bad indication on the price of the share.
Analysis Of The Financial Statements Of Coca Cola Finance Essay
The objective of this analysis is to demonstrate how to conduct this process as it applies to the Coca Cola Company. Thus, investors should be careful about comparing financial leverage between companies from different industries. SIC:2086, Bottled, and Canned Soft Drink, All Asset Ranges. Intangible assets including trademarks and goodwill represent more than 35% of total assets. Finally, it is recommended that the company should invest in farming fresh ingredients to control the costs of producing healthy drinks and lower its prices.
Included here are net profit margin, return on investment, return on equity. While Coca-Cola does have the higher figures, Pepsi has the better margins in terms of operating margins, revenue, and profit which is more important for growing companies. John Pemberton and since then has been a catalyst for social interaction and inspired innovation. Table 3 provides values of net operating revenues of the company from its six segments. Bradham sought to create a drink that not only was delicious but would also boost energy. Assets were sold and Roy C.
The Coca Cola Company Financial Statement Analysis
The Investors Analysis appears to be better for PepsiCo that that of Coca-Cola. The company has moved into the an emerging consumer market such as China , as now China is taking is firt sip of Coca cola. Conclusions This study is aimed to explore reasons for Coca Cola to make operational improvements for better performance as its financial position was weakening despite its worldwide success. In measuring for the financial statement of the company which is Coca-Cola, it can be suitable to use the significant relationships and the identification of changes as well as the trends. Get your paper price 124 experts online Ratios The ratios are commonly important for analyzing the financial statement due to the reason that it has the permission for the comparison of information in the financial statement to the other financial statement information. It was improved in year 2009 and 2007 but, in 2008 once again it indicate a negative trend. This report will contribute additional knowledge on how to analyze the financial position of a company to determine if it is earning or losing.
So the overall situation is quite satisfactory. Coca Cola would benefit from a reduction in short term debt. Leverage Appendix A Leverage ratios measure the degree of protection of suppliers of long term funds. Ernst and Young LLC is the independent firm that is tasked with auditing and providing financial statements for Coca-Cola Company. The Coca Cola company is one of the most well-known companies in globally manufacturing and distributing soda products. Debt represents the largest factor affecting shareholder equity. In 1903, Bradham moved the bottling of Pepsi-Cola from his drugstore to a rented warehouse.
The coca cola company financial statement analysis
The study provides the regulatory authorities insight on how the Z score can be used to improve their supervisory oversight function. Therefore, negative growth rates could be expected in these years. Coca-Cola has a slightly higher operating cycle ,Which favors PepsiCo Working capital cannot be compared. CRITICAL ANALYSIS: Appendix A The fizz is back in Coca-Cola's stock. This process will be based upon the planning and financial management of the company.
The varaiation in the prices of the raw materials would directly and indirectly affect the production coas which in turn would affect the profitability of Coca cola. The company has its operation in more that 200 countries and sells nearly up to 100 different brands. It is indicated that Coca Cola has effective product development and marketing strategies as compared to PepsiCo. Receivables Turnover:In Coca cola the number of times receivables are converted into cash has showed continuous varation from 2007 to 2009. The projected earning growth for the company is 2. Financial Overview 2008 Industry Average 1 Liquidity Solvency Quick ratio 0.
Coca cola has a strong Earning per share and this would continue growing for the next 2 to 5 years. This was indication of negative trend. Indonesian Journal of Applied Business and Economic Research, 1, 34-46. Over the years the brand equity of Coca cola trade mark,the produces brands ,has established the company a prominent figure in the non alcoholic industry and allowed comapnay to maintain high revenue and profits. The average collection period and receivables-to-sales are in line with industry averages.
As the prices of the other currencies weaken relative to dollar , goods that are sold outside the US are worth back in the US, lowering earmning. FINANCIAL ANALYSIS FINANCIAL STATEMENTS Balance sheet Cash Flow Statement INCOME STATEMENT COCA COLA - BACKGROUND INFORMATION The coca cola company is the world's largest produces of non alcoholic beverages concentrates and syrups. Coca cola is considered to be one of the most valuable brands worldwide. Return on Equity: The Return on Equity was maximum in 2008 but decreased in 2009 and went down more in 2007. The gross profit margin of the company did not change much as a proportion to its sales in the last five years, which implies that it managed its cost of sales efficiently. . Solvency is within a reasonable range with industry averages but better management of working capital, specifically current liabilities is indicated.