COCA-COLA EUROPACIFIC PARTNERS PLC (CCEP): what the price assumes

In the published model solve dated 2026-Q2, anchored at $109.10, COCA-COLA EUROPACIFIC PARTNERS PLC (CCEP) is priced for +0.1% growth. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-07-25.

Generated: 2026-08-30 · Exported: 2026-08-31 · Source: https://boothcheck.com/report/CCEP

Headline

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

The operating-margin figure is value-band context at year 12: derived from the framework's value band, a separate calculation — not part of the priced-in solve.

Solve inputs: computed at a 7.3% cost of capital with 4% terminal growth over a 5-year stage.

How unusual the bet is: within-range (limited comparison data)

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.

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 7.5%); the inversion above states its own rate.

Per-Model Detail (n=17)

Solvency

Bullet Takeaways

• Fourteen countries, one contract: the 20-F states that 2025 revenue "was derived from the distribution of beverages under agreements with TCCC", with Great Britain at 17% of revenue, Iberia 16% and Germany 15% on the European side, and Australia 11% and the Philippines 9% in Asia-Pacific.
• A trailing operating margin near 13.4% is bottler economics rather than brand economics, sitting alongside COCA-COLA CONSOLIDATED (COKE) at 13.3% while the concentrate owner COCA-COLA (KO) runs 29.3%.
• Today's price embeds roughly no operating-profit growth over five years, against April guidance reaffirming comparable operating profit growth of about 7% for the year.

Bull Case

The methods used to triangulate this business are unusually spread out, and the direction of the spread is the argument. The approaches that discount future cash flows land above today's price. Peer-multiple comparisons land almost exactly on it. The approaches that capitalize a year of profit and assume the company never grows again land well below it. Read as a set, that is a market paying roughly what a permanently flat bottler would be worth, and getting whatever growth actually shows up for nothing.

Which matters because growth has been showing up. In the first quarter, revenue reached €5,001 million, up 6.7% as reported and 9.4% on a currency-neutral basis, with volumes of 970 million unit cases and revenue per unit case of €5.29. Europe delivered €3,549 million and Asia-Pacific €1,452 million. Management reaffirmed full-year guidance for comparable revenue growth of 3% to 4% and comparable operating profit growth of about 7%. A price that assumes flat is being asked to accommodate a company guiding to seven.

The structural reason this can be underwritten is what the business actually owns. CCEP does not own the brands; it owns the only lawful route those brands take to a shelf across fourteen countries, under agreements the 20-F describes as requiring the company to "purchase our entire requirement of concentrates and syrups for Coca-Cola trademark beverages" from the brand owner. That is a contractual territory, not a market share to be defended each quarter, and it comes with the physical assets, the routes and the retail relationships that make the territory worth anything.

The returns are ordinary and the cash is not. The company reported revenue of €20.9 billion and operating profit of €2.8 billion for 2025, alongside €3.0 billion of net cash from operating activities and a return on invested capital of 10.9%. Operating cash flow exceeding reported operating profit is what a business with heavy depreciation and disciplined working capital looks like, and it is the reason the company can pay a dividend, buy back stock and still invest at around 5% of revenue.

Capital return is where that shows up. The share count was flat across the four years to the end of 2025, and the company is now guiding to a €1 billion buyback across 2026, with €500 million already completed at the time of the April update, plus an interim dividend of €0.82 a share and a full-year payout target of roughly half of comparable earnings. The repurchased shares are cancelled outright.

The bear is right that a 13.4% trailing operating margin will never be a brand-owner margin, and it will not. What it will be is a margin on a very large revenue base that grows with population, price and pack mix in fourteen countries, collected by the only company legally able to collect it there.

Bear Case

The territory looked impregnable and it is being nibbled at from three sides, all of them visible in the company's own reporting. Start with pricing, because that is where the erosion is easiest to mistake for strength. Revenue per unit case rose 0.8% in the first quarter, and the company attributes the increase to "positive mix, headline pricing, Suntory alcohol exit & French sugar tax". Two of those four are not pricing power. A sugar tax passed through to the shelf raises the recorded revenue per case and takes nothing to the bottom line, and losing a distribution contract flatters the average by removing a low-priced product.

That Suntory exit is the second side. CCEP stopped distributing Suntory alcohol in Australia in June 2025 and in New Zealand in December 2025, and management sizes the full-year drag at roughly 0.5% of group revenue, with about a 3% hit to revenue per case in Asia-Pacific. Third-party distribution contracts are the part of a bottler's network that other people can take back, and one just was.

The third side is the consumer. The 20-F is explicit that comparable volumes were "partially offset by greater consumer focus on affordability and the increase in sugar taxes". In the first quarter, European away-from-home volumes fell 1.2% while home volumes rose 3.1%, and transactions ran behind volume growth in Europe, which the company links to "growth of large format packs". Away-from-home is the channel that carries the price; large multipacks bought at a supermarket are the channel that does not. A consumer trading from a chilled single-serve to a discounted two-litre bottle is still counted as volume, and the mix beneath that volume is moving the wrong way.

The structural constraint is that the brand owner shares in any success. Concentrate cost is "directly linked to revenue per UC through incidence pricing", which means a successful price increase automatically raises what CCEP pays for its key input. That mechanism is why a 13.4% trailing operating margin sits where it does while COCA-COLA (KO) earns 29.3% and MONSTER (MNST) 29.3% on the brand side of the same value chain. Even KEURIG DR PEPPER (KDP), which owns brands and bottles them, runs 20.8%. The bottler is the party in this arrangement whose upside is capped by contract.

Regulation is the slow variable and the filing does not minimise it. The 20-F warns that "Health concerns could reduce consumer demand for some of our products, impacting our financial performance" and that fragmented packaging rules "could increase our costs and may have a material impact on the cost and efficiency of our operations". Fourteen jurisdictions means fourteen legislatures, and every deposit-return scheme, packaging levy and sugar tax lands as cost on a business already operating at bottler margins.

None of this threatens solvency. Interest was covered about 9.1 times over on trailing operating profit, which is comfortable. It threatens the growth assumption instead, and growth is what the buyer at this price is declining to pay much for and would still very much like to receive.

Valuation

Bottling is a business where the price you pay decides almost everything, because the margin is set by contract and the volume is set by demography. So begin with what today's price assumes. At roughly 18 times company-wide operating income, the embedded assumption is operating profit growing at about 0% a year over a five-year stage. Measured against the company's own record that is not a stretch; if anything it is a shortfall, and the multiple itself sits toward the cheaper end of the beverage comparisons.

The methods fan out around that. The forward cash-flow approaches land above the price, which is not the usual arrangement for a mature consumer name. The peer-multiple family sits essentially at the price, reading it about 5% above where that family lands. The book-value-plus-profitability family reads the price about double where it sits, and the earnings-power family, which capitalizes one year of profit at a required return and credits no growth at all, reads it further above still. The last of those is the one to interpret carefully rather than take at face value: a no-growth capitalization is close to the worst frame available for a company whose whole proposition is slow, contractual compounding in fourteen countries.

Cohort position is where the picture sharpens. A trailing operating margin near 13.4% is not a disappointment against the right comparison; it is the going rate for the job. COCA-COLA CONSOLIDATED (COKE), the other listed bottler in this set, earns 13.3%. The brand owners earn roughly twice that, with COCA-COLA (KO) at 29.3% and MONSTER (MNST) at 29.3%, and PEPSICO (PEP), which is both, at 14.8%. Comparing CCEP's multiple to a brand owner's would be a category error; comparing its margin to COKE's is the comparison that means something, and on that basis it is performing to standard.

The filed numbers behind the multiple are unambiguous. Revenue of €20.9 billion produced reported operating profit of €2.8 billion in 2025, alongside €3.0 billion of net cash from operating activities and a 10.9% return on invested capital. The five-year average of operating income sits below the trailing figure, which is worth holding in mind: the trailing year is the better one, not a depressed one, so the flat growth the price embeds is being applied to a good base rather than a bad one.

Solvency does not constrain the story. Trailing operating profit covered the interest bill about 9.1 times over, and the same year's operating cash flow of €3.0 billion comfortably funded the €910 million of dividends paid. What that combination buys is optionality: a company with this coverage can keep buying its own shares through a soft consumer year without touching the investment programme, which is precisely what it committed to in April with a €1 billion repurchase for 2026. The price is not asking the balance sheet a difficult question. It is asking whether fourteen national beverage markets can grow at all.

Catalysts

The first-quarter trading update, published April 28, 2026 for the quarter ended April 3, carried the year's central numbers. Group revenue was €5,001 million, up 6.7% as reported and 9.4% currency-neutral, on 970 million unit cases and revenue per unit case of €5.29. Reported volume rose 8.5% but comparable volume, which strips out six extra trading days and an earlier Easter, rose 1.6%, with Europe up 1.4% and Asia-Pacific up 1.9%. Within Asia-Pacific, management flagged a return to more normalised growth in the Philippines and encouraging sparkling volumes in Indonesia. The gap between the reported and comparable volume figures is the thing to carry into the next report: those six extra days reverse in the fourth quarter.

Guidance was reaffirmed in full and is specific enough to be checked. For 2026 the company expects comparable revenue growth of 3% to 4%, cost of sales per unit case up about 1.5% with commodities hedged at roughly 85%, comparable operating profit growth of about 7%, a comparable effective tax rate near 26%, capital expenditure around 5% of revenue including leases, and comparable free cash flow of at least €1.7 billion. The commodity hedge coverage is the quiet detail: most of the input-cost risk for the current year is already fixed, so the guidance rests mainly on volume and mix rather than on raw materials.

Capital return is running on a published schedule. An interim dividend of €0.82 a share was declared in the first quarter and paid on May 27, 2026, calculated at roughly 40% of the prior year's dividend, against a full-year payout target near 50% of comparable earnings. The €1 billion buyback for 2026 was half completed by late April, and a further repurchase of up to €1 billion is subject to shareholder approval at the 2026 annual meeting. Weekly filings track the execution: in the week to July 17, 2026 the company bought 165,000 ordinary shares on US venues and 62,762 on London venues, all of which are cancelled rather than held. Half-year results are the next scheduled event, and the volume line beneath the pricing is what will decide how the guidance holds.

Peer Cohorts (Per Segment, With Filing Citations)

APS (reported)

• COKE (COCA-COLA CONSOLIDATED, INC.)
• FY2025 10-K: …us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetUnamortizedGainLossMember 2023-12-31 0000317540 us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetUnamortizedGainLossMember 2024-01-01 2024-12-31 0000317540…
• FY2025 10-K: …materials, as well as equipment for the distribution, marketing and production of nonalcoholic beverages. We purchase all of the plastic bottles used in our manufacturing plants from Southeastern Container and Western Container, two manufacturing cooperatives we co-own with several other Coca‑Cola bottlers, and all…
• KO (COCA COLA CO)
• FY2025 10-K: …us-gaap:PensionPlansDefinedBenefitMember us-gaap:DefinedBenefitPlanEquitySecuritiesNonUsMember 2024-12-31 0000021344 us-gaap:FairValueMeasuredAtNetAssetValuePerShareMember us-gaap:PensionPlansDefinedBenefitMember us-gaap:DefinedBenefitPlanEquitySecuritiesNonUsMember 2024-12-31 0000021344…
• FY2025 10-K: …ko:MutualPooledAndCommingledFundsMember 2025-12-31 0000021344 us-gaap:FairValueMeasuredAtNetAssetValuePerShareMember us-gaap:PensionPlansDefinedBenefitMember ko:MutualPooledAndCommingledFundsMember 2025-12-31 0000021344 ko:MutualPooledAndCommingledFundsMember us-gaap:PensionPlansDefinedBenefitMember 2025-12-31…
• KDP (Keurig Dr Pepper Inc.)
• FY2025 10-K: …translated into U.S. dollars at a monthly average rate, calculated using daily exchange rates. Differences arising from the translation of opening balance sheets of these entities to the rate at the end of the financial year are recognized in AOCI. The differences arising from the translation of foreign results at…
• FY2025 10-K: …Consolidated Statements of Cash Flows. RECENTLY ISSUED ACCOUNTING STANDARDS In February 2024, the FASB issued ASU 2024-03, Income Statement Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40) . The objective of ASU 2024-03 is to require entities to provide enhanced disclosures of…
• PEP (PepsiCo, Inc.)
• FY2025 10-K: …we are using artificial intelligence to reimagine our go-to-market model, enhance customer support, and empower sales teams to focus on strategic growth. This allows us to unify data, gain real-time inventory visibility, and provide faster, more responsive customer service. We are becoming more resilient through…
• FY2025 10-K: Member 2023-01-01 2023-12-30 0000077476 us-gaap:OperatingSegmentsMember pep:PepsiCoFoodsNorthAmericaMember pep:A2019ProductivityPlanMember 2025-12-27 0000077476 us-gaap:OperatingSegmentsMember pep:PepsiCoBeveragesNorthAmericaMember pep:A2019ProductivityPlanMember 2024-12-29 2025-12-27 0000077476…
• PRMB (Primo Brands Corp)
• FY2025 10-K: …of the vesting commencement date. Performance-based PIUs will vest based on the return on investment by the investors of Triton Water Parent Holdings, LP, at the time of an exit transaction or final sale. During the year ended December 31, 2025, the Company granted 64,813 shares of Class A common stock with an…
• FY2025 10-K: ASU No. 2025-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets , to provide entities with a practical expedient when estimating expected credit losses that assumes that current conditions as of the balance sheet date do not change for the…
• MNST (Monster Beverage Corp)
• FY2025 10-K: …Cooperation and Development ("OECD") has recommended changes to numerous long-standing international tax principles through its base erosion and profit shifting ("BEPS") project and, as recently as early January 2026, has agreed upon an OECD BEPS global minimum tax framework. These changes, to the extent adopted, may…
• FY2025 10-K: …limited to, aluminum cans, aluminum cap cans, sleek aluminum cans, aluminum cans with re-sealable ends, kegs as well as to a limited extent, polyethylene terephthalate (PET) plastic bottles. 7 Table of Contents Manufacture and Distribution AFF develops and manufactures the primary flavors for our Monster Energy®…

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.