Is Coca-Cola Ready to Outperform?

With shares of The Coca-Cola Company (NYSE:KO) trading around $36.89, is KO an OUTPERFORM, a WAIT AND SEE, or a STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

E = Equity to Debt Ratio is Close to Zero

Coca-Cola’s debt-to-equity ratio of 0.99 looks pretty good when compared against its major competitors. We also need to consider total debt and total cash on hand, which for Coca-Cola is $32.74 billion in debt, and $18.08 billion in cash.

This compares to Pepsico, Inc. (NYSE:PEP), which has a debt-to-equity ratio of 1.30 with $27.94 in total debt and $5.71 billion in cash. Smaller soda-industry player Dr Pepper Snapple Group, Inc. (NYSE:DPS) has a debt-to-equity ratio of 1.19, with $2.77 billion in debt and $395 million in cash.

T = Technicals on the Stock Chart are Good

As of December 18, the stock price was 0.50 percent below its 20-day simple moving average, or SMA; 0.19 percent above its 50-day SMA; and 0.34 percent above its 200-day SMA.

Since the beginning of 2012 the stock price has been in an upward trend, rising 6.30 percent this year to date and 10.67 percent year over year.

As a benchmark, the S&P 500 has risen 13.29 percent year to date, and has 20.03 percent year over year.

For comparison, Pepsico has climbed 6.22 percent this year to date, and 9.57 percent year over year, while shares of Dr Pepper Snapple Group have climbed 16.56 percent this year to date, and 15.99 percent year over year.