I have been using Coconut Battery for the better part of a decade. It is very accurate. But you need to understand what you are looking at and what it is measuring. Coconut Battery looks at your current, live, battery health. Battery health fluctuates hundreds of times a day. Every time you plug it in, unplug it, run battery draining tasks, etc., the battery health will fluctuate. Apple's reading, on the other hand takes a 2-weeks average of the battery health. It does not account for minute by minute changes as they are meaningless.
Under heavy load, in Coconut Battery, you can see the battery health drop from 99% to 94% almost immediately. Then, once the battery returns to a normal temperature, it returns back to 99% health. I've seen as large as a 10-point swing over the course of a day.
Just asking for my own knowledge - Is something wrong with Coconut battery and the M5 Air? Coconut says my new M5 Air capacity is ~ 101% (which I've read before sometimes this is normal for new batteries to be over-capacity).
Battery health can be over 100%. Typically, a new Apple Device has between 101-104% battery health. My iPhone 17 Pro Max, with 175 cycles is still at 101.9% health. Battery health is not linear and its possible it will drop from 101% to 99% in a matter of a dozen cycles. All that matters is that it retains 80% after 1000 cycles. Thats what it is rated for.
My M1Pro MBP dropped to 94% health by 50 cycles. It then sat at 94% health for another 250 cycles before dropping to 93%.