Coca-Cola Consolidated: Fair Value Estimated at $139 Based on 2-Stage Free Cash Flow to Equity

Coca-Cola Consolidated's estimated fair value is $139 based on 2-stage free cash flow to equity. The company's share price of $114 is close to its estimated fair value. Coca-Cola Consolidated's peers appear to be trading at a higher discount to fair value based on the industry average of 26%. The intrinsic value of Coca-Cola Consolidated is estimated by projecting its future cash flows and discounting them to today's value using a Discounted Cash Flow (DCF) model.

Coca-Cola Consolidated's estimated fair value is $139 based on a 2-stage free cash flow to equity model [1]. As of July 2, 2025, the company's share price of $114 is close to its estimated fair value. This valuation places Coca-Cola Consolidated at a slight premium compared to its peers, who appear to be trading at a higher discount to fair value based on the industry average of 26% [2].

The intrinsic value of Coca-Cola Consolidated is estimated by projecting its future cash flows and discounting them to today's value using a Discounted Cash Flow (DCF) model. This approach takes into account the company's historical performance and future growth prospects. The 2-stage model used in this analysis incorporates both short-term and long-term growth rates, providing a comprehensive valuation.

The company's recent financial performance has been robust, with earnings surpassing expectations in Q2 2025 [1]. This strong performance has been driven by pricing power, which has offset softer demand and declining global unit volumes. Coca-Cola Consolidated's management has reaffirmed its full-year organic revenue growth guidance of 5–6% and raised its currency-neutral EPS growth expectations to about 8%, acknowledging some currency headwinds [1].

However, the company's high payout ratio of 75–80% limits reinvestment flexibility, making it an attractive option for income-focused investors. The 2.9% dividend yield provides a reliable income stream, supported by a long track record of increases [1].

Investors must weigh a dependable dividend and modest growth against a premium valuation and limited upside. Coca-Cola Consolidated offers income stability but only moderate long-term appreciation potential. Currency pressures and competitive intensity add to execution risks, though predictable cash flows and consistent capital returns lend resilience.

For investors seeking higher growth potential, the company's peers, such as PepsiCo, Inc. (PEP), may offer more attractive valuations and stronger capital efficiency [1]. However, Coca-Cola Consolidated's pricing power and defensive growth remain compelling factors for those looking for a stable income stream.

References:
[1] https://finance.yahoo.com/news/coca-cola-company-ko-bull-171840493.html
[2] https://sg.finance.yahoo.com/news/coca-cola-europacific-partners-first-134201073.html