The Coca-Cola Company (NYSE:KO) is a household name. For investors, Coca-Cola is a safe stock to hold given strong fundamentals and high dividend yield. The company traded for $59.85 a share at the time of presenting this analysis.
The market price per share is important for three unique reasons. First, it is in line with a fair value of $59. Second, the share is at a significant resistance level. Third, the share price has been pushing through the resistance with all signs of the potential of setting a new high.
Investors consider that Coca-Cola would provide good preservation of capital while offering good returns on investment. The company recently increased dividends by 5%. Besides, Coca-Cola’s market power means that it will weather the economic pressures of high inflation and interest rates.
Coca-Cola projected to decline to $56 before a rebound to $63
Source – TradingView
Our analysis of Coca-Cola indicates a sustainable bullish trend. The price chart shows the market valuation finding support at MA 50 which is currently at $56.61. The current share price is, therefore, likely to pull back from $59 to $56 creating an opportunity to buy.
The rebound from the MA 50 has been followed sustainably by a higher high. This means that the share could be expected to cross above $63.04, the highest level in the year.
Summary
Coca-Cola is trading at a fair value price of $59. Technical analysis shows the possibility of pulling back to $56 where the share will gather momentum to rise above $63. Coca-Cola is an attractive investment in the prevailing market and economic conditions.
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