Intrinsic value of Coca Cola Femsa S.A.B. de C.V. - KOF

Previous Close

$64.64

  Intrinsic Value

$113.37

stock screener

  Rating & Target

str. buy

+75%

Previous close

$64.64

 
Intrinsic value

$113.37

 
Up/down potential

+75%

 
Rating

str. buy

We calculate the intrinsic value of KOF stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 0001), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 13.6

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   2
   3
   4
   5
   6
   7
   8
   9
   10
   11
   12
   13
   14
   15
   16
   17
   18
   19
   20
   21
   22
   23
   24
   25
   26
   27
   28
   29
   30
   31

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  20.90
  19.31
  17.88
  16.59
  15.43
  14.39
  13.45
  12.60
  11.84
  11.16
  10.54
  9.99
  9.49
  9.04
  8.64
  8.27
  7.95
  7.65
  7.39
  7.15
  6.93
  6.74
  6.57
  6.41
  6.27
  6.14
  6.03
  5.92
  5.83
  5.75
Revenue, $m
  12,525
  14,944
  17,616
  20,538
  23,708
  27,119
  30,767
  34,645
  38,748
  43,072
  47,614
  52,370
  57,341
  62,525
  67,926
  73,546
  79,390
  85,464
  91,777
  98,337
  105,155
  112,242
  119,612
  127,278
  135,256
  143,563
  152,216
  161,234
  170,638
  180,447
Variable operating expenses, $m
  10,690
  12,632
  14,778
  17,125
  19,670
  22,409
  25,338
  28,452
  31,748
  35,220
  38,236
  42,055
  46,047
  50,210
  54,547
  59,060
  63,753
  68,631
  73,700
  78,968
  84,443
  90,135
  96,053
  102,209
  108,615
  115,286
  122,235
  129,477
  137,028
  144,905
Fixed operating expenses, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total operating expenses, $m
  10,690
  12,632
  14,778
  17,125
  19,670
  22,409
  25,338
  28,452
  31,748
  35,220
  38,236
  42,055
  46,047
  50,210
  54,547
  59,060
  63,753
  68,631
  73,700
  78,968
  84,443
  90,135
  96,053
  102,209
  108,615
  115,286
  122,235
  129,477
  137,028
  144,905
Operating income, $m
  1,835
  2,312
  2,838
  3,414
  4,038
  4,710
  5,428
  6,192
  7,000
  7,852
  9,378
  10,315
  11,294
  12,315
  13,379
  14,486
  15,637
  16,834
  18,077
  19,369
  20,712
  22,108
  23,559
  25,069
  26,641
  28,277
  29,981
  31,758
  33,610
  35,542
EBITDA, $m
  2,955
  3,526
  4,156
  4,845
  5,593
  6,398
  7,259
  8,173
  9,142
  10,162
  11,233
  12,355
  13,528
  14,751
  16,025
  17,351
  18,730
  20,163
  21,652
  23,200
  24,808
  26,480
  28,219
  30,028
  31,910
  33,870
  35,911
  38,039
  40,257
  42,572
Interest expense (income), $m
  209
  444
  614
  804
  1,013
  1,243
  1,492
  1,759
  2,046
  2,350
  2,672
  3,011
  3,368
  3,741
  4,131
  4,538
  4,962
  5,403
  5,862
  6,338
  6,834
  7,349
  7,884
  8,440
  9,018
  9,620
  10,246
  10,898
  11,577
  12,285
  13,023
Earnings before tax, $m
  1,392
  1,698
  2,034
  2,400
  2,795
  3,218
  3,669
  4,147
  4,650
  5,180
  6,367
  6,947
  7,553
  8,184
  8,841
  9,524
  10,234
  10,972
  11,739
  12,535
  13,363
  14,224
  15,119
  16,051
  17,021
  18,031
  19,083
  20,180
  21,325
  22,519
Tax expense, $m
  376
  458
  549
  648
  755
  869
  991
  1,120
  1,256
  1,399
  1,719
  1,876
  2,039
  2,210
  2,387
  2,571
  2,763
  2,962
  3,169
  3,384
  3,608
  3,840
  4,082
  4,334
  4,596
  4,868
  5,152
  5,449
  5,758
  6,080
Net income, $m
  1,016
  1,239
  1,485
  1,752
  2,040
  2,349
  2,678
  3,027
  3,395
  3,782
  4,648
  5,072
  5,514
  5,974
  6,454
  6,953
  7,471
  8,009
  8,569
  9,151
  9,755
  10,384
  11,037
  11,717
  12,425
  13,162
  13,931
  14,732
  15,567
  16,439

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  17,567
  20,959
  24,706
  28,805
  33,251
  38,035
  43,151
  48,590
  54,345
  60,410
  66,780
  73,451
  80,422
  87,693
  95,267
  103,150
  111,346
  119,866
  128,720
  137,921
  147,483
  157,423
  167,759
  178,511
  189,700
  201,351
  213,487
  226,135
  239,323
  253,082
Adjusted assets (=assets-cash), $m
  17,567
  20,959
  24,706
  28,805
  33,251
  38,035
  43,151
  48,590
  54,345
  60,410
  66,780
  73,451
  80,422
  87,693
  95,267
  103,150
  111,346
  119,866
  128,720
  137,921
  147,483
  157,423
  167,759
  178,511
  189,700
  201,351
  213,487
  226,135
  239,323
  253,082
Revenue / Adjusted assets
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
  0.713
Average production assets, $m
  7,954
  9,489
  11,186
  13,042
  15,054
  17,221
  19,537
  21,999
  24,605
  27,351
  30,235
  33,255
  36,411
  39,703
  43,133
  46,701
  50,413
  54,270
  58,279
  62,444
  66,774
  71,274
  75,954
  80,822
  85,888
  91,162
  96,657
  102,384
  108,355
  114,584
Working capital, $m
  -175
  -209
  -247
  -288
  -332
  -380
  -431
  -485
  -542
  -603
  -667
  -733
  -803
  -875
  -951
  -1,030
  -1,111
  -1,197
  -1,285
  -1,377
  -1,472
  -1,571
  -1,675
  -1,782
  -1,894
  -2,010
  -2,131
  -2,257
  -2,389
  -2,526
Total debt, $m
  6,265
  8,202
  10,342
  12,682
  15,221
  17,952
  20,873
  23,979
  27,265
  30,729
  34,366
  38,175
  42,155
  46,307
  50,632
  55,133
  59,813
  64,678
  69,733
  74,987
  80,447
  86,123
  92,025
  98,164
  104,553
  111,206
  118,135
  125,357
  132,888
  140,744
Total liabilities, $m
  10,031
  11,968
  14,107
  16,448
  18,986
  21,718
  24,639
  27,745
  31,031
  34,494
  38,131
  41,940
  45,921
  50,073
  54,398
  58,898
  63,579
  68,443
  73,499
  78,753
  84,213
  89,888
  95,790
  101,930
  108,319
  114,971
  121,901
  129,123
  136,654
  144,510
Total equity, $m
  7,536
  8,991
  10,599
  12,358
  14,265
  16,317
  18,512
  20,845
  23,314
  25,916
  28,648
  31,510
  34,501
  37,620
  40,870
  44,251
  47,767
  51,422
  55,221
  59,168
  63,270
  67,534
  71,968
  76,581
  81,381
  86,379
  91,586
  97,012
  102,670
  108,572
Total liabilities and equity, $m
  17,567
  20,959
  24,706
  28,806
  33,251
  38,035
  43,151
  48,590
  54,345
  60,410
  66,779
  73,450
  80,422
  87,693
  95,268
  103,149
  111,346
  119,865
  128,720
  137,921
  147,483
  157,422
  167,758
  178,511
  189,700
  201,350
  213,487
  226,135
  239,324
  253,082
Debt-to-equity ratio
  0.830
  0.910
  0.980
  1.030
  1.070
  1.100
  1.130
  1.150
  1.170
  1.190
  1.200
  1.210
  1.220
  1.230
  1.240
  1.250
  1.250
  1.260
  1.260
  1.270
  1.270
  1.280
  1.280
  1.280
  1.280
  1.290
  1.290
  1.290
  1.290
  1.300
Adjusted equity ratio
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429
  0.429

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  1,016
  1,239
  1,485
  1,752
  2,040
  2,349
  2,678
  3,027
  3,395
  3,782
  4,648
  5,072
  5,514
  5,974
  6,454
  6,953
  7,471
  8,009
  8,569
  9,151
  9,755
  10,384
  11,037
  11,717
  12,425
  13,162
  13,931
  14,732
  15,567
  16,439
Depreciation, amort., depletion, $m
  1,120
  1,214
  1,318
  1,432
  1,555
  1,688
  1,830
  1,981
  2,141
  2,310
  1,855
  2,040
  2,234
  2,436
  2,646
  2,865
  3,093
  3,329
  3,575
  3,831
  4,097
  4,373
  4,660
  4,958
  5,269
  5,593
  5,930
  6,281
  6,648
  7,030
Funds from operations, $m
  2,136
  2,453
  2,803
  3,184
  3,596
  4,037
  4,509
  5,008
  5,536
  6,091
  6,503
  7,112
  7,748
  8,410
  9,100
  9,818
  10,564
  11,339
  12,144
  12,982
  13,852
  14,756
  15,697
  16,676
  17,694
  18,755
  19,861
  21,013
  22,215
  23,468
Change in working capital, $m
  -30
  -34
  -37
  -41
  -44
  -48
  -51
  -54
  -57
  -61
  -64
  -67
  -70
  -73
  -76
  -79
  -82
  -85
  -88
  -92
  -95
  -99
  -103
  -107
  -112
  -116
  -121
  -126
  -132
  -137
Cash from operations, $m
  2,166
  2,487
  2,840
  3,225
  3,640
  4,085
  4,560
  5,063
  5,593
  6,152
  6,566
  7,178
  7,817
  8,483
  9,176
  9,896
  10,645
  11,424
  12,233
  13,073
  13,947
  14,855
  15,800
  16,783
  17,806
  18,871
  19,982
  21,139
  22,346
  23,606
Maintenance CAPEX, $m
  -403
  -488
  -582
  -686
  -800
  -924
  -1,056
  -1,199
  -1,350
  -1,510
  -1,678
  -1,855
  -2,040
  -2,234
  -2,436
  -2,646
  -2,865
  -3,093
  -3,329
  -3,575
  -3,831
  -4,097
  -4,373
  -4,660
  -4,958
  -5,269
  -5,593
  -5,930
  -6,281
  -6,648
New CAPEX, $m
  -1,378
  -1,536
  -1,697
  -1,856
  -2,013
  -2,166
  -2,316
  -2,463
  -2,606
  -2,746
  -2,884
  -3,020
  -3,156
  -3,292
  -3,429
  -3,569
  -3,711
  -3,857
  -4,009
  -4,166
  -4,329
  -4,500
  -4,680
  -4,868
  -5,066
  -5,275
  -5,495
  -5,727
  -5,971
  -6,229
Cash from investing activities, $m
  -1,781
  -2,024
  -2,279
  -2,542
  -2,813
  -3,090
  -3,372
  -3,662
  -3,956
  -4,256
  -4,562
  -4,875
  -5,196
  -5,526
  -5,865
  -6,215
  -6,576
  -6,950
  -7,338
  -7,741
  -8,160
  -8,597
  -9,053
  -9,528
  -10,024
  -10,544
  -11,088
  -11,657
  -12,252
  -12,877
Free cash flow, $m
  385
  463
  562
  683
  827
  995
  1,187
  1,401
  1,638
  1,896
  2,004
  2,303
  2,621
  2,957
  3,311
  3,681
  4,069
  4,474
  4,895
  5,332
  5,787
  6,258
  6,748
  7,255
  7,781
  8,328
  8,894
  9,483
  10,094
  10,729
Issuance/(repayment) of debt, $m
  1,739
  1,937
  2,140
  2,341
  2,538
  2,732
  2,921
  3,106
  3,286
  3,463
  3,637
  3,809
  3,980
  4,152
  4,325
  4,501
  4,680
  4,865
  5,056
  5,254
  5,460
  5,676
  5,902
  6,139
  6,389
  6,652
  6,930
  7,222
  7,531
  7,856
Issuance/(repurchase) of shares, $m
  289
  216
  123
  6
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  2,028
  2,153
  2,263
  2,347
  2,538
  2,732
  2,921
  3,106
  3,286
  3,463
  3,637
  3,809
  3,980
  4,152
  4,325
  4,501
  4,680
  4,865
  5,056
  5,254
  5,460
  5,676
  5,902
  6,139
  6,389
  6,652
  6,930
  7,222
  7,531
  7,856
Total cash flow (excl. dividends), $m
  2,412
  2,616
  2,824
  3,030
  3,366
  3,727
  4,108
  4,507
  4,924
  5,359
  5,642
  6,112
  6,601
  7,109
  7,635
  8,182
  8,750
  9,339
  9,950
  10,586
  11,247
  11,934
  12,650
  13,395
  14,171
  14,980
  15,824
  16,705
  17,624
  18,585
Retained Cash Flow (-), $m
  -1,305
  -1,455
  -1,608
  -1,758
  -1,907
  -2,052
  -2,195
  -2,333
  -2,469
  -2,602
  -2,733
  -2,862
  -2,991
  -3,119
  -3,249
  -3,381
  -3,516
  -3,655
  -3,798
  -3,947
  -4,102
  -4,264
  -4,434
  -4,613
  -4,800
  -4,998
  -5,206
  -5,426
  -5,658
  -5,902
Prev. year cash balance distribution, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
  1,107
  1,161
  1,216
  1,271
  1,459
  1,675
  1,913
  2,174
  2,455
  2,757
  2,909
  3,250
  3,611
  3,989
  4,386
  4,801
  5,233
  5,684
  6,152
  6,639
  7,145
  7,670
  8,215
  8,782
  9,370
  9,982
  10,618
  11,279
  11,967
  12,683
Discount rate, %
  4.80
  5.04
  5.29
  5.56
  5.83
  6.13
  6.43
  6.75
  7.09
  7.45
  7.82
  8.21
  8.62
  9.05
  9.50
  9.98
  10.48
  11.00
  11.55
  12.13
  12.74
  13.37
  14.04
  14.74
  15.48
  16.25
  17.07
  17.92
  18.82
  19.76
PV of cash for distribution, $m
  1,057
  1,052
  1,042
  1,024
  1,098
  1,172
  1,237
  1,289
  1,325
  1,345
  1,271
  1,261
  1,232
  1,186
  1,124
  1,048
  962
  868
  771
  673
  576
  485
  400
  324
  256
  199
  151
  112
  81
  57
Current shareholders' claim on cash, %
  97.9
  96.6
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0
  96.0

Coca-Cola FEMSA, S.A.B. de C.V. is a franchise bottler of Coca-Cola trademark beverages across the world. The Company and its subsidiaries are engaged in the production, distribution and marketing of certain Coca-Cola beverages. It is also engaged in acquiring, holding and transferring all types of bonds, shares and marketable securities. The Company's segments include Mexico and Central America division, which comprises Mexico (including corporate operations), Guatemala, Nicaragua, Costa Rica and Panama; the South America division, which consists of Brazil, Argentina and Colombia; Venezuela, which operates in an economy with exchange control and hyper-inflation, and the Asian division, which consists of the Company's equity method investment in Coca-Cola FEMSA Philippines, Inc. The Coca-Cola trademark beverages include sparkling beverages (colas and flavored sparkling beverages), waters and still beverages (including juice drinks, coffee, teas, milk, dairy and isotonic drinks).

FINANCIAL RATIOS  of  Coca Cola Femsa S.A.B. de C.V. (KOF)

Valuation Ratios
P/E Ratio 262.7
Price to Sales 14.9
Price to Book 21.7
Price to Tangible Book
Price to Cash Flow 81.5
Price to Free Cash Flow 133.9
Growth Rates
Sales Growth Rate 16.6%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 10.3%
Cap. Spend. - 3 Yr. Gr. Rate 1.4%
Financial Strength
Quick Ratio 3
Current Ratio 0
LT Debt to Equity 70.5%
Total Debt to Equity 73%
Interest Coverage 5
Management Effectiveness
Return On Assets 5.3%
Ret/ On Assets - 3 Yr. Avg. 5.8%
Return On Total Capital 5.3%
Ret/ On T. Cap. - 3 Yr. Avg. 5.8%
Return On Equity 8.9%
Return On Equity - 3 Yr. Avg. 9.4%
Asset Turnover 0.7
Profitability Ratios
Gross Margin 44.8%
Gross Margin - 3 Yr. Avg. 46.2%
EBITDA Margin 15.3%
EBITDA Margin - 3 Yr. Avg. 16.4%
Operating Margin 11.6%
Oper. Margin - 3 Yr. Avg. 13.5%
Pre-Tax Margin 8.1%
Pre-Tax Margin - 3 Yr. Avg. 9.3%
Net Profit Margin 5.7%
Net Profit Margin - 3 Yr. Avg. 6.5%
Effective Tax Rate 27.2%
Eff/ Tax Rate - 3 Yr. Avg. 27.9%
Payout Ratio 69.6%

KOF stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the KOF stock intrinsic value calculation we used $10360 million for the last fiscal year's total revenue generated by Coca Cola Femsa S.A.B. de C.V.. The default revenue input number comes from 0001 income statement of Coca Cola Femsa S.A.B. de C.V.. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our KOF stock valuation model: a) initial revenue growth rate of 20.9% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 4.8%, whose default value for KOF is calculated based on our internal credit rating of Coca Cola Femsa S.A.B. de C.V., is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Coca Cola Femsa S.A.B. de C.V..
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of KOF stock the variable cost ratio is equal to 86.4%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $0 million in the base year in the intrinsic value calculation for KOF stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 9.8% for Coca Cola Femsa S.A.B. de C.V..

Corporate tax rate of 27% is the nominal tax rate for Coca Cola Femsa S.A.B. de C.V.. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the KOF stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for KOF are equal to 63.5%.

Life of production assets of 16.3 years is the average useful life of capital assets used in Coca Cola Femsa S.A.B. de C.V. operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for KOF is equal to -1.4%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $6231.26588714 million for Coca Cola Femsa S.A.B. de C.V. - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 210.145 million for Coca Cola Femsa S.A.B. de C.V. is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Coca Cola Femsa S.A.B. de C.V. at the current share price and the inputted number of shares is $13.6 billion.

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