Coca-Cola Valuation: Can $88 Price Keep Up with Cash Flows?

Coca-Cola has been on a tear, with an 88.6% total return over the past five years.

This impressive run has raised questions about whether the company's stock price still reflects its underlying value.

The planned $10 billion infrastructure investment in the United States by 2030 and the conditional approval for Coca-Cola HBC to expand into 14 new African markets may support expectations for future cash generation, but also shape the timing and scale of those cash flows.

A Discounted Cash Flow (DCF) model values Coca-Cola by projecting its future cash flows and discounting them back to today. According to this model, Coca-Cola's current free cash flow is about $14.2 billion, which analysts expect to edge higher over the coming decade.