ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. Coca-Cola Co's annualized return on capital (ROC %) for the quarter that ended in Mar. 2026 was 18.54%.
As of today (2026-06-25), Coca-Cola Co's WACC % is 5.51%. Coca-Cola Co's ROC % is 15.84% (calculated using TTM income statement data).
Coca-Cola Co generates higher returns on investment than it costs the company to raise the capital needed for that investment. It is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases.
Coca-Cola Co (LIM:KO) ROC % Explanation
ROC % measures how well a company generates cash flow relative to the capital it has invested in its business. It is also called ROIC %. The reason book values of debt and equity are used is because the book values are the capital the company received when issuing the debt or receiving the equity investments.
There are four key components to this definition. The first is the use of operating income or EBIT rather than net income in the numerator. The second is the tax adjustment to this operating income or EBIT, computed as a hypothetical tax based on an effective or marginal tax rate. The third is the use of book values for invested capital, rather than market values. The final is the timing difference; the capital invested is from the end of the prior year whereas the operating income or EBIT is the current year's number.
Why is ROC % important?
Because it costs money to raise capital. A firm that generates higher returns on investment than it costs the company to raise the capital needed for that investment is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases, whereas a firm that earns returns that do not match up to its cost of capital will destroy value as it grows.
As of today, Coca-Cola Co's WACC % is 5.51%. Coca-Cola Co's ROC % is 15.84% (calculated using TTM income statement data).
Coca-Cola Co generates higher returns on investment than it costs the company to raise the capital needed for that investment. It is earning excess returns. A firm that expects to continue generating positive excess returns on new investments in the future will see its value increase as growth increases.
Be Aware
Like ROE % and ROA %, ROC % is calculated with only 12 months of data. Fluctuations in the company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
Coca-Cola Co ROC % Related Terms
Coca-Cola Co ROC % Historical Data
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The historical data trend for Coca-Cola Co's ROC % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Note:
The Operating Income data used here is four times the quarterly (Mar. 2026) data.
The tax rate is limited to between 0% and 100%.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Coca-Cola Co (LIM:KO) has a ROC % of 18.54% as of Mar. 2026. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Coca-Cola Co and its competitors.
Is Coca-Cola Co's ROC % too high?
Coca-Cola Co's current ROC % is 18.54%. The Beverages - Non-Alcoholic industry median ROC % is 8.72. Coca-Cola Co's value of 18.54% is 112.7% above this industry median. Overall, Coca-Cola Co has a GF Score™ of 69/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Coca-Cola Co's ROC % compare to PEP and MNST?
Coca-Cola Co's ROC % of 18.54% can be compared against companies in the Beverages - Non-Alcoholic industry. The industry median ROC % is 8.72. Coca-Cola Co's value of 18.54% is 112.7% above this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good ROC % for a Beverages - Non-Alcoholic company?
The median ROC % among Beverages - Non-Alcoholic companies is 8.72, based on 114 companies in the industry. Companies in the top quartile (top 25%) have a ROC % significantly above this median, while those in the bottom quartile fall well below. However, ROC % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Coca-Cola Co's current ROC % of 18.54% is 112.7% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high ROC % mean?
A high ROC % can signal that a stock is expensive relative to its fundamentals. Return on capital is the ratio of current-period net income to average two-period capital. View historical data on Coca-Cola Co and its competitors. For the Beverages - Non-Alcoholic industry, the median ROC % is 8.72 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Coca-Cola Co's current ROC % is 18.54%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Coca-Cola Co stock overvalued right now?
Based on GuruFocus' analysis, Coca-Cola Co (LIM:KO) is currently considered Modestly Overvalued. The stock's GF Value™ is $70.21, compared to a current price of $80.50 — trading 14.7% above its estimated fair value. The current ROC % is 18.54% and 112.7% above the Beverages - Non-Alcoholic industry median of 8.72. Coca-Cola Co's overall GF Score™ is 69/100 with 5 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is ROC % calculated?
ROC % is calculated from a company's financial statements. For Coca-Cola Co (LIM:KO), the current ROC % is 18.54% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Coca-Cola Co (LIM:KO) Overvalued in 2026?
Based on GuruFocus' analysis, Coca-Cola Co stock appears to be overvalued.
The current stock price of $80.50 is trading 14.7% above its estimated GF Value™ of $70.21.
GuruFocus considers Coca-Cola Co to be Modestly Overvalued.
Key valuation signals for LIM:KO:
ROC %: 18.54%
GF Value™: $70.21 vs. price of $80.50 (14.7% above fair value)
Industry Position: 112.7% above the Beverages - Non-Alcoholic median
No single metric tells the full story. See the LIM:KO stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Founded in 1886, Atlanta-headquartered Coca-Cola is the world's largest nonalcoholic beverage company, with a strong portfolio of 200 brands covering key categories including carbonated soft drinks, water, sports, energy, juice, and coffee. Together with bottlers and distribution partners, the company sells finished beverage products bearing Coca-Cola and licensed brands through retailers and food-service locations in more than 200 countries and regions globally. Coca-Cola generates around 60% of its total revenue overseas, with sizable contributions from emerging economies in Latin America and Asia-Pacific.
69GF Score
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