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As noted by David et al. (2020), determining the cash value of a corporation is important to estimate because businesses constantly are buying, merging, and
As noted by David et al. (2020), determining the cash value of a corporation is important to estimate because businesses constantly are buying, merging, and divesting portions of their companies with each other which requires some type of valuation. For the purposes of this discussion, we will be looking at the valuation of The Coca-Cola Company based on fiscal year 2023, but current stock price as of June 6, 2024 (Yahoo Finance, 2024). David et al. (2020) discuss the net worth, net income, price-earnings ratio, and outstanding shares methods as the ones used most often, although there are others as well. The following are the inputs and results for these four primary cash valuation methods for The Coca-Cola Company: Coca-Cola FY 2023 Input Data SE $25,941,000 NI $10,714,000 Stock Price $64.15 as of 6/6/24 EPS $1.28 Shares Outstanding 8,369,000 Goodwill $18,358,000 Intangibles $14,865,000 The Four Valuation Methods SE - (Goodwill + Intangibles) ($7,282,000) NI x 5 $53,570,000 (Share Price/EPS) x NI $536,871,350 Shares Outstanding x Share Price $536,871,350 Method Average (Coke's Value) $280,007,675
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