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    Analytical review of Coca-Cola's shares on 11.02.2016

    The Coca-Cola Company, #KO [NYSE]
    Consumer goods, Beverages, non-alcoholic beverages, USA.

    Financial performance:

    Index –DJIA, S&P500;
    Beta – 0.49;
    Capitalization – 185.05В;
    Assets profitability - 7.50%;
    Revenue -10.81B;
    Average volume – 14.76 М;
    P/E - 27.28;ATR – 0.73.


    Analytical review:

    • The Company has the fourth biggest capitalization in the consumer goods sector among the issuers listed on the US stock market.
    • According to the report on the 4th quarter 2015 published on February 9, 2016, the company's net profit increased by 60% (from US $770 million up to US $1.2 billion). EPS amounted to over 64% (from US $0.17 up to US $0.28).
    • At the press conference, the company's management announced that the considerable consolidation of the US dollar had resulted in an 8% profit fall. The Company exceeded analysts' expectations by introducing a tough cost-cutting program (over US $3 billion).
    • A rise in regional sales was recorded during the period under report. The sales grew by over 2% in Africa, Eurasia, and Latin America. In North America and Europe, this indicator increased by 3%.
    • The Company plans to expand business activities in China. The management concluded an agreement with Swire Beverage Holdings for bottling beverages in China.
    • Most of the biggest investment funds and banks (UBS, Stifel, Barclays) forecast a rise in the rate of shares up to US $48.

    Summary:

    • The Company's report on the fourth quarter 2015 shows that the Company's management has been working properly. Despite the strong dollar's pressure, the Company has registered a considerable increase in net profit and sale volumes. The development of partnership with China will contribute to a further rise in the company's capitalization.
    • Thus, we expect the company's quotes to be rising in the nearest future

    Trading recommendations for Coca Cola's CFDs

    Long-term trading:
    #KO is currently trading between the support and resistance levels of 41.50USD and 43.50 USD. Once the level of 43.50 USD is broken and relevant confirming signals appear (PriceAction patterns, for example), we recommend searching for market entry points to open long positions. Risk per trade: no more than 2% of equity. Stop order shall be placed at 42.90 USD. We recommend that positions should be closed partly, with Trailing Stop applied. Prospective profits shall be fixed at 44.50USD, 45.50 USD and 47.00 USD.


    Short-term trading: the issuer has just broken a local support level of 42.65 USD on M15 chart. When holding and testing this level, we recommend opening a speculative short trade. Risk per trade: no more than 1.5% of equity. Stop order shall be placed a bit above the signal line. We recommend that positions should be closed partly, with Trailing Stop applied. Prospective profits shall be fixed partly, at 50%, 30%, and 20% of a prospective fluctuation.



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