Question: Simple Valuation for the Coca-Cola Company (Medium) In early 2006, the 2,369 million outstanding shares of the Coca-Cola Company traded at $48.91 each. The price-to-book ratio was 6.3 and the forward PIE was 19.3 based on analysts; consensus EPS forecast for 2007. An analyst extracted the following numbers from Coke financial statements (in millions of dollars):
a. Calculate the core operating profit margin and asset turnover for each year 2002- 2005.
b. Calculate the average sales growth rate over the years 2003- 2005.
c. The firm reported common shareholders; equity at the end of2005 of $16,945 million, along with $1,010 billion in net financial obligations. Using the numbers you calculated, estimate Cokes enterprise value at the end of 2005 and also the value per share. Use a required return for operations of 10 percent.