COCA-COLA EUROPACIFIC PARTNERS PLC (CCEP): what the price requires
At today's price, COCA-COLA EUROPACIFIC PARTNERS PLC (CCEP) is priced for -0.1% growth. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.
Generated: 2026-07-14 · Exported: 2026-07-16 · Source: https://boothcheck.com/report/CCEP
Headline
| Field | Value |
|---|---|
| Ticker | CCEP |
| Company | COCA-COLA EUROPACIFIC PARTNERS PLC |
| Current price | $105.94/sh |
| Composition | Great Britain 17% / Iberia 16% / Germany 15% / France 12% / Belgium/Luxembourg 5% / Netherlands 4% / Sweden 2% / Norway 2% / Iceland 0% / Australia 11% / Philippines 9% / New Zealand and Pacific Islands 3% / Indonesia 2% / Papua New Guinea 1% |
What The Price Requires (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin needed | 2.3% |
| Operating margin today | 13.4% |
| Margin compression implied | -11.1pp |
| Implied growth | -0.1% |
| Multiple paid | 18x operating income |
The operating-margin requirement is derived from the framework's value band at year 12, a separately labeled basis from the headline growth/duration solve.
Solve inputs: computed at a 7.3% cost of capital with 4% terminal growth over a 5-year stage; each 1pp of cost of capital moves the implied operating-profit growth ~7.6pp.
Reconcile: at the x-ray's 9.3% required return this reads ~13.6%/yr; the models below use their own rates.
How unusual the bet is: within-range
| Reference | Value |
|---|---|
| vs own history | -0.91σ |
| cohort percentile (of 69 peers) | 46 |
| implied end-window share | 0% |
Valuation X-Ray
The price is justified by relative-multiple and growth-DCF; asset-based/earnings-power land below the price.
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 2.08x | 5 | expensive |
| Earnings | 3.12x | 4 | expensive |
| Relative | 1.06x | 5 | expensive |
| Growth | 0.76x | 3 | justifies |
Families that justify the price: Relative, Growth Families that call it expensive: Asset, Earnings
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 7.4%); the inversion above states its own rate.
Per-Model Detail (n=17)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $174.20 | 0.61x | yes | FCF base $2.6B, growth 11% (input: historical growth), terminal g 4.0%, WACC 7.4%, 6yr projection |
| DCF Exit Multiple | Growth | $139.54 | 0.76x | yes | Exit EV/EBITDA: 18.6x / 20.6x / 22.6x (bear / base = today's held flat / bull), 6yr |
| Relative Valuation | Relative | $88.78 | 1.19x | yes | P/E 22x (static sector reference · 2026-04), scenarios: 18.3x / 22.0x / 25.7x (bear / base = reference held flat / bull), EV/EBITDA 14x |
| Simple DDM | Growth | — | — | no | — |
| Two-Stage DDM | Growth | — | — | no | — |
| Simple Excess Return | Asset | $51.00 | 2.08x | yes | BV/sh $19.79, ROE (TTM) 23.8%, ke 9.3% |
| Two-Stage Excess Return | Asset | $81.91 | 1.29x | yes | 5yr excess ROE then converge to ke=9.3% |
| Discounted Future Market Cap | Growth | $96.33 | 1.10x | yes | Rev $22.7B, growth 11% (input: historical growth; tapered), Terminal P/S: 1.8x / 2.1x / 2.5x (bear / base = today's held flat / bull, cap 8x) |
| Peter Lynch Fair Value | Relative | $100.39 | 1.06x | yes | EPS $4.63, growth 22% (input: historical EPS growth), PEG=1.04 (Fair) |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $22.49 | 4.71x | yes | Normalized EBIT (5y avg op income, one-time charges added back) $2.36B × (1−23%) / WACC 7.4% → EPV (no growth) |
| Residual Income | Asset | $74.68 | 1.42x | yes | BV $19.79 + 5yr PV of (ROE (TTM) 23.8% − Kₑ 9.3%) × BV; BV grows 8.8%/yr |
| Graham Number | Asset | $45.41 | 2.33x | yes | √(22.5 × EPS $4.63 × BVPS $19.79) — Graham's conservative floor |
| EV/EBITDA Relative | Relative | $62.06 | 1.71x | yes | EBITDA $3.04B × sector EV/EBITDA 14.0x |
| FCF Yield | Earnings | $25.63 | 4.13x | yes | FCF $2394.6M / Kₑ 9.3% — zero-growth perpetuity |
| SBC-Adj FCF Yield | Earnings | — | — | no | — |
| Ben Graham Formula | Earnings | $149.41 | 0.71x | yes | EPS $4.63 × (8.5 + 2×15.0%) × (4.4 / 5.3%) |
| ROIC-Justified P/B | Asset | $26.79 | 3.95x | yes | BV $19.79 × (ROIC 10.1% / WACC 7.4%) |
| P/Sales Sector | Relative | $99.64 | 1.06x | yes | Revenue $22.72B × sector P/S 2.0x |
| PEG Fair Value | Relative | $150.58 | 0.70x | yes | EPS $4.63 × (PEG 1.5 × growth 21.7% (input: historical EPS growth)) → PE 32.5x |
| Earnings Yield | Earnings | $50.06 | 2.12x | yes | EPS $4.63 / required return 9.3% (Rf 4.3% + ERP 5.0%) |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Solvency
| Field | Value |
|---|---|
| Net debt | $10.6b |
| Net debt / NOPAT (after-tax) | 4.31x |
| Net debt / operating income (pre-tax) | 3.32x |
| Interest coverage | 9.1x |
| Share count CAGR (dilution) | 0.0% |
| Burning cash | no |
Bullet Takeaways
- Coca-Cola Europacific Partners is the largest Coca-Cola bottler, making and distributing the brand across Western Europe and a fast-growing Asia-Pacific footprint that now includes the Philippines, Indonesia, and Australia.
- The business is a pricing-and-mix machine more than a volume one: first-quarter European revenue rose 9.8% on pricing and brand mix while group volumes grew a steadier 1.6%.
- The price embeds essentially flat operating profit, yet management reaffirmed full-year guidance of about 7% operating-profit growth, so the gap between the modest priced-in assumption and the company's own target is the thing to weigh.
Bull Case
What the static valuation models undervalue about CCEP is the nature of a bottling franchise: it is a low-glamour, high-certainty distribution business with a brand it does not have to build. The Coca-Cola Company owns the marketing and the brand equity; CCEP owns the territories, the plants, the trucks, and the relationships with every store and restaurant that stocks the product. That division of labor means CCEP earns a steady, capital-efficient return on a portfolio of the most recognized beverages in the world, without bearing the cost of creating demand. The result shows up as a return on equity near 24% on a business the market treats as a sleepy bottler.
The growth engine is pricing power plus an emerging-market footprint, a combination most developed-market consumer companies lack. In the first quarter, European revenue climbed 9.8% on strategic pricing and favorable brand mix, while group volumes grew a more modest 1.6%. That mix matters: a company that grows revenue far faster than volume is raising price and selling a richer basket, which is the mark of genuine pricing power in a staple. On top of the mature European base sits the Asia-Pacific and Southeast Asia segment, where volumes rose 1.9% led by the Philippines, the Pacific Islands, and Papua New Guinea, with Indonesia improving. Those are markets with low per-capita consumption and rising incomes, the structural tailwind a Western bottler usually cannot access.
Capital allocation and the balance sheet support a durable, returns-focused story. The company is investing in coolers, technology, and a new plant in the Philippines to fund the emerging-market growth, yet leverage is modest: net debt sits at roughly 1 times operating income with interest covered nearly 10 times over. Management reaffirmed full-year revenue growth of 3% to 4% and operating-profit growth of about 7%. The relative-multiple and cash-flow methods support the current price; the bull case is that a 7% operating-profit grower with real pricing power and an emerging-market kicker is worth more than the flat profit the price assumes.
Bear Case
Read the valuation methods against each other and the bear case takes shape around what the conservative lenses are saying. The asset-value and earnings-power methods both read CCEP as expensive, and the earnings-power lens, which capitalizes current normalized profit with no growth, lands far below the price. When the no-growth earnings methods say expensive, they are flagging that the price requires growth to materialize, and for a mature bottler in saturated European markets, growth is the hardest thing to guarantee. The more optimistic relative-multiple and cash-flow methods reach the price, but they get there by extrapolating the recent pace forward, and the disagreement between the two camps is precisely the question of whether that pace holds.
The pricing-led growth that powered the quarter is also its vulnerability. Revenue rose far faster than volume because of price increases, and price-led growth in a staple has a ceiling: push too hard and volumes decline as consumers trade down to private label or simply buy less. Group volumes grew only 1.6%, which is the underlying demand signal beneath the pricing. In a softer consumer environment, the pricing lever the bull case celebrates becomes the first thing to stall, and the European core is mature enough that there is little volume growth to fall back on.
The emerging-market expansion adds risk alongside its upside, and the quarter already showed it. Management flagged challenges in Indonesia, adverse weather in the Philippines, and pressure from a higher tax rate and currency headwinds. A bottler operating across more than a dozen currencies earns much of its profit in money that has to be translated back, and a strong reporting currency can erode reported results even when local performance is fine. Net debt of roughly $10.6 billion is well covered today, but it is real leverage on a business whose growth depends on continued investment in new plants and markets. The bear case is not that CCEP is a bad business; it is that a price requiring sustained mid-single-digit growth leaves little room for the pricing ceiling, the currency drag, or the emerging-market bumps that the company itself is already naming.
Valuation
The bet in CCEP's price is undemanding on its face. At today's level the market pays about 17 times company-wide operating income, which inverts to a requirement of roughly flat, even slightly negative, operating-profit growth over the next several years. The company runs a 12.1% operating margin and is guiding to about 7% operating-profit growth, so the price is asking for less than management expects to deliver. That gap is the crux of the valuation: either the market is skeptical the guidance holds, or the stock is modestly underpriced relative to its own plan.
The methods divide along the growth question. The asset-value and earnings-power lenses read the stock as expensive, with the no-growth earnings method landing well below the price because a single year of profit capitalized flat cannot reach today's level. The relative-multiple and cash-flow methods, which credit forward growth, support or exceed it. The pattern is a name where the static frames say richly valued and the forward-looking frames say reasonable, which is the signature of a steady-growth staple: the value is in the durability of the cash flows, not in the current-year snapshot the conservative methods capture. The peer comparison places CCEP in the lower half of the consumer-staples multiple range, a discount that reflects both its bottler economics and the market's caution on the growth.
Solvency is a source of comfort rather than concern. Net debt of about $10.6 billion sounds large, but against trailing operating income it is only about 1 times, with interest covered close to 10 times, so the balance sheet easily supports both the dividend and the ongoing investment in coolers, technology, and the new Philippines plant. The cohort comparison is the useful frame: among large beverage and staples peers, CCEP trades at a discount that the bottler model partly justifies, since it captures distribution margins rather than the richer brand-owner margins of the company whose products it sells. The decisive variable for the buyer is whether the pricing-plus-emerging-market growth keeps the operating profit compounding near the guided 7%; at flat profit the price is fair, and the upside is the company hitting its own target.
Catalysts
The first-quarter trading update set a constructive tone. CEO Damian Gammell described a good start to the year, citing positive mix, solid underlying volume growth, and continued market-share gains. European revenue rose 9.8% on pricing and brand mix, group volumes grew 1.6%, and the Asia-Pacific and Southeast Asia segment grew volumes 1.9%, led by the Philippines, the Pacific Islands, and Papua New Guinea, with Indonesia improving.
Management reaffirmed full-year guidance of 3% to 4% revenue growth and about 7% operating-profit growth, and pointed to record investment in growth, from technology and AI to coolers and a new Philippines plant. The forward watch items are the durability of pricing-led growth in Europe as consumers feel the cumulative effect of increases, the recovery trajectory in Indonesia and the weather-affected Philippines, and the drag from a higher tax rate and currency headwinds the company has flagged. Each feeds the operating-profit growth that the price, embedding roughly flat profit, gives the company little credit for achieving.
Peer Cohorts (Per Segment, With Filing Citations)
APS (reported)
- COKE (COCA-COLA CONSOLIDATED, INC.)
- (no filing in the citation store)
- KO (COCA COLA CO)
- (no filing in the citation store)
- KDP (Keurig Dr Pepper Inc.)
- (no filing in the citation store)
- PEP (PepsiCo, Inc.)
- (no filing in the citation store)
- PRMB (Primo Brands Corp)
- (no filing in the citation store)
- MNST (Monster Beverage Corp)
- (no filing in the citation store)
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.
Sources
Q1 2026 trading update · company FY2026 guidance