Is The Coca-Cola Company's (KO) Dividend Safe?
The Coca-Cola Company yields 2.59% with a payout ratio of 68.20%.
By TGMCharts Research / 12 resolved facts / trust score 100
Research lead
The Coca-Cola Company yields 2.59% with a payout ratio of 68.20% and a free-cash-flow payout ratio of 71.25%.
Key facts
- -The Coca-Cola Company yields 2.59% and pays $2.08 per share.
- -The payout ratio is 68.20% and the free-cash-flow payout ratio is 71.25%.
- -Consecutive dividend increases stand at 62 years.
- -Five-year dividend CAGR is 4.46% versus five-year EPS CAGR of 11.12%.
- -Net margin is 27.80% and trailing P/E is 25.25x.
Primary research exhibit
Exhibit: KO dividend yield history
Dividend yield is the market-facing income exhibit and the first check for whether the current payout looks unusually attractive or stressed.
Latest dividend yield: 2.59%.
A yield of 2.59% is only useful when paired with payout support. A high yield can be a real income opportunity, but it can also reflect price pressure if earnings and free cash flow are not keeping up.
Executive Summary
The Coca-Cola Company starts the dividend safety check with a 2.59% yield, a dividend of $2.08 per share, and 62 years of consecutive increases. That history matters, but it does not settle the safety question by itself. The safety read depends on whether earnings, free cash flow, and dividend growth still support the payment.
The current payout ratio is 68.20% and the free-cash-flow payout ratio is 71.25%. Reading those together matters because a dividend is safest when accounting earnings and cash generation point in the same direction. When they diverge, the cash-flow exhibit deserves more weight than the streak.
Income Context And Payment Record
Research exhibits
Evidence inside the argument
Supporting exhibit 1
Exhibit: KO dividend per share history
Dividend per share shows the actual payment record behind the headline yield.
Latest dividend per share: $2.08.
The current dividend of $2.08 sits beside a record of 62 years of consecutive increases. That history earns attention, but it still has to be supported by current earnings and cash flow.
Counterpoint exhibit 2
Exhibit: KO price history behind the yield
The price chart helps distinguish an attractive yield from a yield lifted mainly by share-price weakness.
Latest close: $80.31 as of June 23, 2026.
A dividend yield of 2.59% should be read beside the price path. If the yield is rising because price is falling while payout ratios are already high, the dividend note should become more cautious rather than more enthusiastic.
Counterpoint exhibit 3
Exhibit: KO free cash flow history
Free cash flow is the cash support line behind the accounting payout ratio.
Latest free-cash-flow payout ratio: 71.25%.
The free-cash-flow payout ratio is 71.25%, so the cash-flow chart matters as much as the earnings chart. A dividend can look acceptable on EPS while still becoming fragile if cash generation falls behind the payment.
Supporting exhibit 4
Exhibit: KO EPS history
EPS history checks whether the earnings base is growing with the dividend.
Five-year EPS CAGR: 11.12%.
Five-year EPS CAGR of 11.12% is the earnings support line for dividend growth. If dividend growth keeps running ahead of EPS, the engine should treat the article as needing a more cautious refresh.
The yield chart shows what the market is offering today, while the dividend-per-share chart shows what the company has actually paid. The Coca-Cola Company has a five-year dividend CAGR of 4.46%, which is useful only if it remains aligned with the business. A payout can grow for a while from policy choice, but it eventually needs earnings and cash flow to carry it.
Evidence From TGMCharts Exhibits
The primary exhibit is dividend yield because it captures the first question an income investor asks. The supporting exhibits then move from payment history to price pressure, EPS support, free cash flow, dividend growth, and margin quality. The safest reading comes when the yield, payment path, EPS line, cash-flow line, and margin record all point in a consistent direction.
Earnings And Free Cash Flow Support
Dividend growth should not outrun the business for long. The Coca-Cola Company shows a five-year dividend CAGR of 4.46% against a five-year EPS CAGR of 11.12%, with net margin at 27.80%. If dividend growth is ahead of EPS growth, the payout and free-cash-flow exhibits become the decisive part of the note.
Counterpoints And Risks
The main counterpoint is that a long dividend history can hide a narrowing cushion. A payout ratio of 68.20% and a free-cash-flow payout ratio of 71.25% should be watched together. If cash flow weakens, the dividend may look safer in the headline record than it is in the operating data.
What Would Change The View
The dividend read should change if payout ratios move materially higher, if EPS growth falls behind dividend growth, or if the stored dividend record stops supporting the current payment. The nightly refresh should mark the article stale before those changes drift into the published page.
Methodology And Caveat
This research insight uses precomputed TGMCharts fundamentals, embedded chart exhibits, and a frozen claim ledger. It is not a buy or sell call. Dividend safety can change quickly if earnings, cash flow, or management policy changes, so the claim ledger should be refreshed after every daily precompute cycle.
Additional exhibits
More chart evidence
Supporting exhibit 5
Exhibit: KO dividend per share history
Dividend per share shows the actual payment record behind the headline yield.
Latest dividend per share: $2.08.
The current dividend of $2.08 sits beside a record of 62 years of consecutive increases. That history earns attention, but it still has to be supported by current earnings and cash flow.
Supporting exhibit 6
Exhibit: KO net margin history
Net margin helps distinguish a stable payout from one that depends on thin profitability.
Latest net margin: 27.80%.
Net margin of 27.80% gives the dividend note a business-quality check. Strong margins do not guarantee safety, but weak or declining margins can reduce the cushion behind future increases.
Research Trail
Continue through the underlying TGMCharts pages behind this note.
FAQ
Is KO's dividend safe?
The Coca-Cola Company yields 2.59% with a payout ratio of 68.20% and a free-cash-flow payout ratio of 71.25%. Those figures need to stay supported by EPS and cash flow for the dividend case to remain intact.
What supports KO's dividend?
The support comes from the dividend record, payout ratios, EPS growth, and the reported dividend growth path. Consecutive increases stand at 62 years.
What would make KO's dividend less safe?
A weaker safety read would come from a higher payout ratio, a higher free-cash-flow payout ratio, or dividend growth running ahead of five-year EPS CAGR of 11.12%.
More KO research insights
Valuation
Is The Coca-Cola Company (KO) Overvalued?
The Coca-Cola Company trades at 25.25x trailing earnings with a model margin of safety of 26.51%.
Claim ledger
This article was generated from precomputed TGMCharts data. Numeric facts were resolved before publishing and are refreshed after the daily precompute job. If a required fact becomes unavailable, the article is marked stale instead of being silently rewritten.