Delve into the intricate process of calculating and interpreting value drivers and multiples statistics for major corporations like Coca-Cola, Monster Beverage Corporation, and PepsiCo. Gain insight on how these calculations are used to determine enterprise value and the implied EV range.
Key Insights
- Three major companies, Coca-Cola, Monster Beverage Corporation, and PepsiCo, were analyzed for their share price, market cap (equity value), and enterprise value.
- Value drivers such as Sales, EBITDA, EBIT, and EPS were calculated for each of these companies to help ascertain their worth.
- Multiples statistics were calculated for a comprehensive understanding of the company's valuation.
- The valuation of Coca-Cola was found to be in line with its peer group based on these calculations.
- An implied enterprise value (EV) was calculated using EBITDA and the EV / LTM EBITDA ratio.
- The implied EV range for Coca-Cola was found to be from $204B to $307B, providing a broad perspective on the company's potential value.
Build a Financial Model
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Lay Out Assumptions
Inputs at the top, color-coded blue — never hardcoded in formulas.
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Build the Income Statement
Revenue, COGS, OpEx, EBITDA — driven by assumptions.
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Add Balance Sheet
Working capital, fixed assets, debt — must balance.
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Cash Flow Reconciles
Operating, investing, financing — ties to balance sheet cash.
We have three comparable companies: Coca-Cola, Monster Beverage Corporation, and PepsiCo.
We calculated share price, market cap (equity value), and enterprise value for each company.
We also calculated value drivers such as Sales, EBITDA, EBIT, and EPS.
Let’s calculate multiples statistics:
E13==$D6/E6
I13=$D6/I6
M13=$D6/M6
Q13=$B6/Q6
Coca-Cola is just along the lines with its peer group.
From here we can interpret the outputs. The most convenient way is to put the highest and lowest multiples together with the mean and the company we are valuing.
E20=MAX(E14:E17)
E21=MIN(E14:E17)
E22=AVERAGE(E14:E17)
E23=E14
EBITDA of Coca-Cola: F26=H6
EV / LTM EBITDA: Max=F28=H20; Min=G28=H21; Mean=H28=H22
Implied EV = f29=F28*$F$26
Implied EV range is from $204B to $307B.
