Teaching Note | HBS Case Collection | May 2013

Coca-Cola: Residual Income Valuation

by Suraj Srinivasan and Edward J. Riedl

Abstract

Teaching note for a case of the same title that introduces students to the residual income (also known as the abnormal earnings) valuation model using the firm Coca-Cola. Students are provided with the primary financial statements (through fiscal 2010) and forecast data/assumptions. These data are used as input into a simple spreadsheet model to derive pro-forma summary financial statements (balance sheet and income statement), as well as Coca-Cola's firm and per share equity valuation at the beginning of 2011.

Keywords: valuation; Valuation; United States;

Citation:

Srinivasan, Suraj, and Edward J. Riedl. "Coca-Cola: Residual Income Valuation." Harvard Business School Teaching Note 113-065, May 2013.