This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Investing in Coca-Cola Is the 'Real Thing'

The 136-year-old company sells its products primarily under the Diet Coke, Fanta, Sprite, Coca-Cola Zero, Vitamin Water, PowerAde, Minute Maid, Simply, Georgia, and Del Valle brand names.

KO offers its beverage products through company-owned or controlled bottling and distribution operators, as well as through independently owned bottling partners, distributors, wholesalers, and retailers.

Rival PepsiCo (PEP - Get Report) has been pouring on increased competition. It is spending multi-millions to increase the purchase and consumption of its best-selling brands like Pepsi-Cola, Cherry Pepsi and Mountain Dew ("and them that refuse it are few" as the words of the old country song goes.)

Coca-Cola is working its own earnings growth strategies. As an example of how KO continues to churn out huge profits ($2.31 billion in the third quarter), it announced on Oct. 16 that Coca-Cola and French pharmaceutical giant Sanofi (SNY - Get Report) have a joint partnership to launch a new line of beverages to promote wellness and beauty.

The drinks, called Beautific Oenobiol, which is Sanofi's nutrition and beauty brand, will debut in France in pharmacies in autumn. The falling leaves should spell rising revenue for both companies, and KO should be more than able to sustain its $1.02 annual dividend, which represents a relatively high 52% payout ratio.

Shareholders won't be biting their nails or breaking out in a sweat about Coca-Cola's financial might. With more than $18 billion in total cash as of the most recent quarter, trailing 12 months operating cash flow of $10.51 billion and trailing 12 months levered free cash flow of $6.42 billion, it should remain both the "real thing" and the "real deal" for growth-at-a-reasonable price investors for years to come.

At the time of publication the author is long shares of KO.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

Jim Cramer and Stephanie Link actively manage a real money portfolio for his charitable trust- enjoy advance notice of every trade, full access to the portfolio, and deep coverage of the latest economic events and market movements.
2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
KO $44.80 0.00%
PEP $102.96 0.00%
SNY $41.10 0.00%
AAPL $93.74 0.00%
FB $117.58 0.00%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs