BUSINESS OVERVIWS The World's Largest Nonalcoholic Beverage Company. The Coca-Cola Company (NYSE: KO) is a total beverage company with products sold in more than 200 countries and territories. Coca-Cola company’s purpose is to refresh the world and make a difference. Their portfolio of brands includes Coca-Cola, Sprite, Fanta and other sparkling soft drinks. Their hydration, sports, coffee and tea brands include Dasani, smartwater, vitaminwater, Topo Chico, Powerade, Costa, Georgia, Gold Peak, Honest and Ayataka. Together with their bottling partners, they employ more than 700,000 people, helping bring economic opportunity to local communities worldwide. AT A GLANCE Calculating the true value of any business is not as easy as it may seem. While the market cap of a public entity, such as Coca Cola, is its stock price multiplied by the total number of shares outstanding, calculating Coca Cola's enterprise value requires a different approach. It uses Coca Cola's balance sheet items such as
Although the value of free cash flow will most likely stabilize to about 11 B. Coca-cola shows a prevailing Real Value of $66.19 per share. The current price of the firm is $61.39. At this time, the firm appears to be slightly undervalued. Our model approximates the value of Coca-cola from analyzing the firm fundaments such as:
SALES PER REGION COCA - COLA STOCK PRICE & RSI COCA - COLA QUARTERLY PRICES COCA COLA DIVIDENDS ANALYSIS Coca Cola has scaled down on payment of dividends at this time. PE Ratio is expected to rise to 30 this year, although the value of accumulated retained earnings deficitwill most likely fall to about 76.4 B. There are various types of dividends Coca Cola can pay to its shareholders, and the actual value of the dividend is determined on a per-share basis. It is to be paid equally to all of Coca Cola shareholders on a specific date, known as the payable date. The cash dividend is the most common type of dividend payment - it is the payment of actual cash from Coca-Cola directly to its shareholders. There are other types of dividends that companies can issue, such as stockdividends or asset dividends. When Coca Cola pays a dividend, it has no impact on its emterprise value. It does, however, lowers the Equity Value of Coca Cola by the value of the dividends paid out. OWNERSHIP STRUCTURE WHO OWNS COCA-COLA COMPANY ? - Institutions: 69.75 % - General Public: 30% - Individual Insiders: 0.64% RISK FACTORS Coca-Cola secures Sharpe ratio of 0.2, which signifies that the company had 0.2% of return per unit of standard deviation over the last six months. Our philosophy in foreseeing the volatility of a stock is to use all available market data together with stock-specific technical analysis that cannot be diversified away. Downward market volatility can be a perfect environment for investors who play the long game. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Coca Cola's beta of 0.71 provides an investor with an approximation of how much risk Coca Cola stock can potentially add to one of your existing portfolios, a beta of 0.71 indicates less volatility. CONCLUSION
Coca-Cola remains the undisputed leader in the beverage industry, and numerous players such as PepsiCo and Red Bull have been unable to displace it from this position. Coca-Cola’s position is attributable to its unique branding strategy that caters to customer preferences. Competitors like Red Bull and Starbucks pose a threat to its dominance in specific markets. However, Coca-Cola’s continued investments in developing markets and its focus on product quality will ensure that it remains the number one player in this highly competitive industry, at least in the foreseeable future.
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I want to give you more insight into why some companies are a wonderful opportunity to hedge against inflation and provides you an opportunity to build a solid portfolio. In my search for truly wonderful businesses, I look for specific qualitative and quantitative factors. What define a great business to me is:
What is more as Warren Buffet refers is management’s decisions must be intelligent, and their interests must be business oriented, because management, ultimately, is the link between business value and shareholder value. Tela advisor strive to buy shares only in high quality companies which I believe can compound in value for many years to come. We believe that Tractor Supply is an excellent business, with high returns on invested capital, intelligent management, and strong growth potential. Tractor Supply has consistently grown store count, and revenues for over 20 years grown from $2.068B in 2005 to $12,29B in 2021. Tractor Supply Company is an excellent business operating in a dominant position within the niche marketplace. Tractor Supply’s product selection is precisely targeted to its core-customer base, and the company knows its customers well. Sales per Business Growing sales by opening new stores is good but generating higher sales from existing stores is even more important for a retailer as it is an indication of the company’s ongoing relevance to consumers and competitive position. We believe that Tractor Supply Company has excellent growth opportunities ahead. The company plans to open over 600 new Tractor Supply stores, as well as 800 new subsidiary pet supplies stores in the coming years. Finally, the company stands to continuously expand its customer base as more families migrate to the suburban markets which contain most of Tractor Supply’s nearly two thousand stores. Company Overview Tractor Supply Company (TSCO: NASDAQ) has a well-established dominance as a specialty store covering the broad needs of its mostly suburban and rural clientele. Products include farm, ranch, home, garden, pet, clothing, livestock, and equine needs along with, as the name suggests, tractor parts, accessories, and maintenance needs. “Everything but the tractor” as one analyst put it. TSCO thrives in a niche market of suburban, and rural areas where a competitor with a similar range of products, and who can compete on price is nowhere to be found. Tractor Supply benefits from repeat business from its most loyal customers as many of the items the company sells are consumables. Part of TSCO’s strategy for repeat business comes from its loyalty rewards program called “Neighbor's Club”. Neighbor's Club members account for 65% of TSCO’s total sales, and membership continues to grow. Retention rates are higher than 95% for club . members, and new millennial customers purchasing items such as pet food, chicken feed, and other products are joining the Neighbor's Club at a rate of 1 in 3 customers. As a national brand, Tractor Supply benefits from scale-based cost advantages in advertising and has developed a successful customer loyalty program, which helps drive repeat business. Repeat customers are extremely valuable to any business because they cost far less to acquire. Maintaining these customer relationships is an important task necessary to protect the company’s revenues. Tractor Supply’s Neighbor's Club helps maintain these important relationships by way of reward programs, and additional perks such as free utility trailer rentals for qualified customers. In order to maintain this competitive advantage, Tractor Supply is currently expanding product selection, and continuously adding perks via the Neighbor's Club. The Neighbor’s Club now has over 20 million members. Performance measures such as sales per store, EBITDA per store, net income per store, and sales per square foot show a positive trend, with 2020 showing the strongest year yet. Sales per store have increased 38.8% from $3.6 million in 2010, to $5m in 2020. Similarly, sales per square foot have increased 46.2% from $225.89 in 2010 to $330.45 in 2020. EBITDA per store has nearly doubled from $336k in 2010 to $666k in 2020 and finally, net income per store has grown from $168k in 2010, to $356k in 2020, representing a 112% increase. Capital Allocation Over the past 10 years Tractor Supply Company generated $6.2 billion in cash from operations. $2.3 billion was spent on capital expenditures and acquisitions over that same period.
Hal Lawton (CEO) has focused on better monetizing TSCO’s omnichannel presence, which now accounts for 10% total sales in Q2 2021, as opposed to 2% at year-end 2019. Lawton has successfully allocated resources to help TSCO’s ecommerce sales grow by 5-fold. We expect online and in-app sales to continue to grow as a % of total sales as the younger, tech-savvy generations choose to shop at Tractor Supply more over the coming years.
Conclusion We believe that Tractor Supply Company is a high-quality company. It earns outstanding returns on capital underpinned by economies of scale, has ample room for growth and its management has done an admirable job of capital allocation. Tractor Supply recently raised company guidance during the Q2 2021 earnings call. Current guidance from management states a range of $12.1 billion to $12.3 billion in revenues, with comparable store sales growth in the range of 11% to 13% for 2021. The company also expects share repurchases to range from $700 million to $800 million. The company is currently acquiring Orscheln Farm & Home, a retailer of farm and ranch supplies, which of course, is in line with Tractor Supply’s core business. The acquisition will lead to an addition of 167 Orscheln Farm & Home stores across 11 states, for a price of $297 million. Orscheln Farm & Home’s potential addition to TSCO’s income is not included in current guidance. I am going to show you how to do stock price forecasting in a quick and reliable and significantly accurate way, so today we are going to dive into PayPal Inc stock. I am going to take five years of data[2016-2020] and show you how we are going forecast it so without further delay let us jump on it. Log residual will help us navigate where PayPal stock price will continue its fluctuations over the next months if only if the systematic risk is stable. Anything can happen in the stock market in near future, Mr. Market mood is never predicable, however our job is to read market and Mr. Market is there to serve us, and not become its slave FISRTS STEP Install and load those packages and pull data from Yahoo Finance. Identify the class you are working with, what type of data are we pulling? The class will tell us quickly that it is XTS ~zoo. When we have XTS data set that we are working with XTS object, that means we have the data column and index filed which contain dates in it. It is a little bit different than data frame data set. For this analysis purpose I am going only to analyze adjusted prices. You are free to work with (OHLC), open, high, low, and close or even only with volume. class(PYPL_adjsusted) ## [1] "xts" "zoo" NEXT STEP Next step is to look at ACF an PACF. ACF is an (complete) auto-correlation function which gives us values of auto-correlation of any series with its lagged values. We plot these values along with the confidence band and tada! We have an ACF plot. In simple terms, it describes how well the present value of the series is related with its past values. A time series can have components like trend, seasonality, cyclic and residual. ACF considers all these components while finding correlations hence it’s a ‘complete auto-correlation plot’. PACF is a partial auto-correlation function. Basically, instead of finding correlations of present with lags like ACF, it finds correlation of the residuals (which remains after removing the effects which are already explained by the earlier lag(s)) with the next lag value hence ‘partial’ and not ‘complete’ as we remove already found variations before we find the next correlation. So, if there is any hidden information in the residual which can be modeled by the next lag, we might get a good correlation and we will keep that next lag as a feature while modeling. Remember while modeling we do not want to keep too many features which are correlated as that can create multicollinearity issues. Hence we need to retain only the relevant features. ACCURACY MODELSReferences
Hlavac, Marek. 2018. stargazer: Well-Formatted Regression and Summary Statistics Tables (version 5.2.2). https://CRAN.R-project.org/package=stargazer. Hyndman, Rob, George Athanasopoulos, Christoph Bergmeir, Gabriel Caceres, Leanne Chhay, Mitchell O’Hara-Wild, Fotios Petropoulos, Slava Razbash, Earo Wang, and Farah Yasmeen. 2020. forecast: Forecasting Functions for Time Series and Linear Models (version 8.12). https://CRAN.R-project.org/package=forecast. Kleiber, Christian, and Achim Zeileis. 2020. AER: Applied Econometrics with R (version 1.2-9). https://CRAN.R-project.org/package=AER. Pfaff, Bernhard. 2016. urca: Unit Root and Cointegration Tests for Time Series Data (version 1.3-0). https://CRAN.R-project.org/package=urca. Ryan, Jeffrey A., and Joshua M. Ulrich. 2020. quantmod: Quantitative Financial Modelling Framework (version 0.4.17). https://CRAN.R-project.org/package=quantmod. Wickham, Hadley, and Jennifer Bryan. 2019. readxl: Read Excel Files (version 1.3.1). https://CRAN.R-project.org/package=readxl. Wickham, Hadley, and Dana Seidel. 2020. scales: Scale Functions for Visualization (version 1.1.1). https://CRAN.R-project.org/package=scales. Zeileis, Achim. 2019. dynlm: Dynamic Linear Regression (version 0.3-6). https://CRAN.R-project.org/package=dynlm. A BRIEF ANALYSIS OF Visa & MasterCard STOCK: DATA ANALYSIS & DATA VISUALIZATION WITH QUANTMOD, IN R11/1/2021 WRITTEN BY TELA ADVISOR JANUARY 11, 2021 Visa Inc. (Visa) is a payments technology company that connects consumers, merchants, financial institutions, businesses, strategic partners and government entities to electronic payments. The Company operates through payment services segment. The Company enables global commerce through the transfer of value and information among the participants. The Company's transaction processing network facilitates authorization, clearing and settlement of payment transactions and enables to provide its financial institution and merchant clients a range of products, platforms and value-added services. The Company is a retail electronic payment network based on payments volume, number of transactions and number of cards in circulation. Its products/services include core products, processing infrastructure, transaction processing services, digital products, merchant products, and risk products and payment security initiatives visa vs mastercard18 MONTHS SNAPSHOT PERFORMANCE Mastercard Incorporated is a technology company that connects consumers, financial institutions, merchants, governments and businesses across the world, enabling them to use electronic forms of payment. The Company allows user to make payments by creating a range of payment solutions and services using its brands, which include MasterCard, Maestro and Cirrus.
The Company provides a range of products and solutions that support payment products, which customers can offer to their cardholders. The Company's services facilitate transactions on its core network among account holders, merchants, financial institutions, businesses, governments and other organizations in markets globally. The Company's products include consumer credit, consumer debit, prepaid and commercial. It also provides integrated offerings such as cyber and intelligence products, information and analytics services, consulting, loyalty and reward programs and processing solutions. Stock data analysis and data visualization with Quantmod, Magrittr in R |