Coca-Cola’s Cash Flow Strength Meets Slower Sales Growth

Coca-Cola’s gross margin and free cash flow margin stand out, but its sales growth has been modest, according to a StockStory analysis. The stock returned 14.1% since March, compared with a 21.1% gain for the S&P 500.

StockStory said Coca-Cola averaged a 61.7% gross margin over the past two years. The company’s trailing 12-month free cash flow margin was 28.6%, up 30.1 percentage points over the last year.

The caution is revenue growth: Coca-Cola’s sales grew at a 4.3% annualized rate over the past three years. StockStory said that trailed the consumer staples sector, while concluding the company’s positive attributes outweighed the concern.

Coca-Cola shares were recently at $86.82, down 0.03% since the previous close, as of 15:51 UTC Wednesday. StockStory cited a forward price-to-earnings ratio of 25.7 at the article’s stated price of $87.