KO
The Coca-Cola Company
Consumer Defensive · Beverages - Non-Alcoholic · United States · Stock
Score Breakdown
Scored for Aggressive Growth profile
Sub-scores are 0–20 each; Model Score is weighted by your selected investment goal. How it works →
Why Ranked Here
- The score of 63.1/100 reflects a perfect profitability result and solid momentum, offset by a mid-range growth score driven by only 1.9% revenue expansion, a below-average dividend score from the 67.0% payout ratio, and zero contribution from the theme factor.
- Financial health is solid but not top-tier, as the debt-to-equity ratio of 1.31 introduces leverage risk even though the interest coverage ratio of 8.3 demonstrates adequate debt-service capacity.
- The absence of any macro theme assignment means Coca-Cola receives no theme-based score boost, capping its total composite score despite strong underlying business fundamentals.
Why Not Higher
- Revenue growth of just 1.9% year-over-year and a dividend payout ratio of 67.0% in FY2025 both constrain the growth and dividend factor scores, preventing the composite from reaching the higher tiers.
- With no assignment to any of the 24 tracked macro themes, Coca-Cola foregoes up to 20 points of potential theme-based score contribution, which is a significant ceiling on the total model score.
Data Confidence
10 / 10
Very High — full data coverage
Why This Score
Grounded in figures from this company's SEC EDGAR filings — not a restatement of the score itself.
Revenue grew modestly from FY2024 to FY2025, rising from $47,061,000,000 to $47,941,000,000 (+1.9%), while net income expanded significantly from $10,631,000,000 to $13,107,000,000 (+23.3%) and diluted EPS rose from $2.46 to $3.04 (+23.6%) over the same period.
The model rewarded the strong bottom-line expansion in FY2025, but the near-flat top-line revenue growth of just 1.9% likely tempered the overall growth score, resulting in a mid-range result.
In FY2025, Coca-Cola posted a net margin of 27.3%, an operating margin of 28.7%, and a return on assets of 12.5%, reflecting broad-based profitability across income and asset efficiency measures.
The model awarded a perfect score, recognizing that all three profitability metrics in FY2025 indicate a highly efficient business capable of converting revenue into profit and generating strong returns on its asset base.
In FY2025, Coca-Cola carried a debt-to-equity ratio of 1.31 and an interest coverage ratio of 8.3, against a total asset base of $104,816,000,000.
The model reflects a company with meaningful leverage as indicated by the FY2025 debt-to-equity ratio of 1.31, partially offset by a comfortable interest coverage ratio of 8.3, which suggests the company can service its debt obligations from operating income — yielding a solid but not top-tier financial health score.
Over the last four reported quarters, revenue ranged from $11,822,000,000 in 2025Q4 to $12,535,000,000 in 2025Q2, with 2026Q1 at $12,472,000,000; operating income dipped sharply to $1,841,000,000 in 2025Q4 before rebounding to $4,359,000,000 in 2026Q1; net income followed a similar pattern, falling to $2,271,000,000 in 2025Q4 and recovering to $3,924,000,000 in 2026Q1.
The model appears to reward the strong recovery in both operating and net income in 2026Q1 following a weak 2025Q4, while the relative stability of revenue across the four quarters supports a positive but not maximum momentum score.
Coca-Cola's dividends per share have increased each year from $1.76 in FY2022 to $1.84 in FY2023, $1.94 in FY2024, and $2.04 in FY2025, though the dividend payout ratio stood at 67.0% of net income in FY2025.
The model recognizes the consistent multi-year dividend growth trend, but the elevated FY2025 payout ratio of 67.0% signals that a large share of earnings is being returned to shareholders as dividends, which may limit the score under a model framework that weighs payout sustainability or retained earnings capacity.
Coca-Cola is not currently assigned to any of the 24 tracked macro themes in the model.
The absence of a macro theme assignment means the security did not qualify for theme-based score contribution under the current methodology; this is a neutral classification and does not reflect on the company's underlying business quality.
Research Summary
AI-generated analysis reflects data and conditions as of the report date shown above. Verify any specific figures through primary sources before acting on this analysis.
Coca-Cola earns a composite score of 63.1/100 with a Medium risk rating and a Research Candidate label, reflecting a business that excels in profitability but faces headwinds from modest top-line growth and an elevated dividend payout ratio. In FY2025, the company posted a net margin of 27.3%, an operating margin of 28.7%, and a return on assets of 12.5%, while net income surged 23.3% even as revenue grew only 1.9% year-over-year. Financial health is solid but tempered by a debt-to-equity ratio of 1.31, and recent quarterly momentum showed a sharp dip in 2025Q4 followed by a strong 2026Q1 recovery. The absence of a macro theme assignment limits additional score contribution from that dimension.
Plain English
Coca-Cola is an extremely profitable company that squeezes a lot of earnings out of every dollar of sales, but its overall sales aren't growing very fast, it carries a meaningful amount of debt, and it pays out a large chunk of its profits as dividends — which is why it scores in the middle of the pack rather than near the top.
Bull Case vs. Bear Case
Bull Case
- Exceptional profitability: Coca-Cola achieved a net margin of 27.3%, an operating margin of 28.7%, and a return on assets of 12.5% in FY2025, earning a perfect profitability score and demonstrating a highly efficient business model.
- Strong bottom-line growth: Net income expanded 23.3% from FY2024 to FY2025 (from $10,631,000,000 to $13,107,000,000) and diluted EPS rose 23.6% to $3.04, showing powerful earnings leverage even on modest revenue growth.
- Consistent dividend growth: Dividends per share have risen every year from $1.76 in FY2022 to $2.04 in FY2025, reflecting a multi-year commitment to returning capital to shareholders.
Bear Case
- Near-flat revenue growth: Top-line revenue grew only 1.9% from FY2024 to FY2025 ($47,061,000,000 to $47,941,000,000), limiting the overall growth score and raising questions about volume and pricing power.
- Elevated dividend payout ratio: The FY2025 payout ratio of 67.0% of net income signals that a large share of earnings is committed to dividends, potentially constraining reinvestment capacity and future financial flexibility.
- Meaningful leverage: A debt-to-equity ratio of 1.31 in FY2025 indicates significant leverage against a total asset base of $104,816,000,000, which introduces financial risk even though the interest coverage ratio of 8.3 remains comfortable.
What Could Change the Picture
Bullish Triggers
- A sustained acceleration in revenue growth beyond the current 1.9% annual rate would signal improved volume or pricing dynamics and could meaningfully lift the growth score.
- A reduction in the dividend payout ratio — achieved through faster net income growth or a moderation in dividend increases — would improve retained earnings capacity and strengthen the dividend sustainability profile.
Bearish Triggers
- A deterioration in the interest coverage ratio below comfortable levels, or a meaningful increase in the debt-to-equity ratio beyond 1.31, would signal worsening financial health and elevate balance sheet risk.
- A repeat of the sharp operating income decline seen in 2025Q4 ($1,841,000,000) without a subsequent recovery would undermine the positive momentum narrative established by the 2026Q1 rebound.
Risk Profile
Medium RiskCoca-Cola carries a debt-to-equity ratio of 1.31 in FY2025, representing meaningful leverage relative to its equity base, though an interest coverage ratio of 8.3 indicates the company can comfortably service its debt from operating income. Quarterly results showed a sharp dip in operating income to $1,841,000,000 in 2025Q4 before rebounding strongly to $4,359,000,000 in 2026Q1, highlighting some earnings volatility that investors should monitor.
This report is for educational and research purposes only. It does not constitute financial, investment, legal, or tax advice — always conduct your own due diligence before making investment decisions.