investorscraft@gmail.com

Coca-Cola Consolidated, Inc. (COKE)

Previous Close
$113.94
Sector Valuation Confidence Level
Low
Valuation methodValue, $Upside, %
Artificial intelligence (AI)1441.341165
Intrinsic value (DCF)148.7831
Graham-Dodd Method180.6259
Graham Formula810.59611

Strategic Investment Analysis

Company Overview

Coca-Cola Consolidated, Inc. (NASDAQ: COKE) is the largest independent Coca-Cola bottler in the United States, manufacturing, marketing, and distributing a diverse portfolio of nonalcoholic beverages. The company operates primarily in the consumer defensive sector, offering sparkling beverages (carbonated drinks), still beverages (energy drinks, bottled water, juices, and sports drinks), and post-mix fountain products. Serving grocery stores, convenience stores, restaurants, and recreational facilities, COKE also distributes third-party brands like Dr Pepper and Monster Energy. Headquartered in Charlotte, North Carolina, Coca-Cola Consolidated benefits from strong brand recognition, an extensive distribution network, and a resilient business model tied to essential consumer demand. With a market cap of nearly $10 billion, the company plays a critical role in the non-alcoholic beverage supply chain, leveraging its long-standing partnership with The Coca-Cola Company while maintaining operational independence.

Investment Summary

Coca-Cola Consolidated presents a stable investment opportunity within the consumer defensive sector, supported by its dominant position as the largest independent Coca-Cola bottler in the U.S. The company’s revenue ($6.9B in latest reporting) and net income ($633M) reflect strong operational execution, while its low beta (0.885) suggests lower volatility compared to the broader market. However, investors should consider risks such as dependence on The Coca-Cola Company’s brand performance, exposure to inflationary pressures in supply chains, and competitive pricing in the non-alcoholic beverage industry. The dividend yield (~0.8% based on $8/share) is modest, but the company’s strong cash position ($1.14B) and manageable debt ($1.91B) provide financial flexibility. Long-term growth may hinge on expanding distribution partnerships and adapting to shifting consumer preferences toward healthier beverage options.

Competitive Analysis

Coca-Cola Consolidated’s competitive advantage stems from its exclusive territorial rights as a Coca-Cola bottler, granting it a quasi-monopoly in key U.S. markets. Unlike pure-play beverage producers, COKE’s vertically integrated model—combining manufacturing, distribution, and direct-to-retail sales—ensures margin stability and operational efficiency. Its scale allows for cost advantages in logistics and procurement, while its diversified portfolio (including third-party brands like Monster Energy) mitigates reliance on a single product category. However, the company faces competition from other major bottlers such as Coca-Cola Europacific Partners and Keurig Dr Pepper, which have broader geographic reach or stronger brand portfolios. Additionally, the rise of private-label beverages and health-conscious alternatives poses a long-term threat. COKE’s regional focus in the U.S. limits exposure to international volatility but also caps growth potential compared to global peers. Its ability to innovate in distribution (e.g., vending machines, fountain services) and sustain relationships with retail partners remains critical to maintaining its edge.

Major Competitors

  • Coca-Cola Europacific Partners (CCEP): CCEP is the largest Coca-Cola bottler globally, operating in 29 countries with a strong presence in Europe and Asia-Pacific. Its geographic diversification reduces market-specific risks, but it lacks COKE’s deep penetration in the U.S. CCEP’s scale provides cost advantages, though it faces higher exposure to currency fluctuations and geopolitical risks.
  • Keurig Dr Pepper (KDP): KDP combines a robust portfolio of owned brands (Dr Pepper, Snapple) with coffee systems (Keurig), giving it broader product diversification than COKE. Its direct-store-delivery network rivals COKE’s, but its reliance on sugary beverages aligns with slower-growing segments. KDP’s innovation in cold beverages and partnerships (e.g., Peet’s Coffee) are strengths.
  • PepsiCo (PEP): PepsiCo is a vertically integrated beverage and snack giant (Frito-Lay, Gatorade), offering economies of scale and a balanced portfolio. Its global reach and marketing power outpace COKE, but its bottling network is less centralized. PEP’s focus on healthier snacks and zero-sugar drinks positions it well for shifting consumer trends.
HomeMenuAccount