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
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Coca-Cola Needs Less Fizz in Its Products to Get More in Its Stock

NEW YORK (TheStreet) -- You can tell when an iconic brand name like Coca-Cola (KO) is running out of great sales ideas. If one of the top headlines for the company that invented the word "Coke" reads Slumping Diet Coke Goes Slurpee, even Warren Buffett might start squirming.

As a shareholder I'm glad Coca-Cola is looking for ways to extend the brand, such as selling a Diet Cherry Coke frozen beverage exclusively at 7-Eleven stores under the Slurpee brand as of Wednesday. It might add some fizz to the stock, which is down over 8% for the year to date as of the Wednesday close of $37.87.

KO is down over 13% from its 52-week high partly because of the ominous guidance on its operating profit in 2014 when it released with fourth-quarter earnings last week. It also disappointed when it reported that its beverage volume rose only 1% for the quarter and 2% for the year. CEO Muhtar Kent squarely placed responsibility for the bad news on, you guessed it, the weather as well as the challenging economic conditions in the many areas of the world where it sells its beverages.


Investors aren't buying it -- as in the shares. After the earnings the stock fell nearly 4% and on Feb. 20 it hit a 52-week low of $36.89. Part of the reason that the stock is languishing -- the Atlanta company isn't PepisCo (PEP).

Pepsico has grown its product mix to the point that its snack food division outperforms its beverage segment. Recently I  wrote that as a result, shares of PEP have soared while activist investors push for a shareholder-friendly spinoff of its snack food dynasty.

Diversity-poor Coca-Cola still gets the vast majority of sales and earnings from selling beverages, especially the bubbly kind. In fact about 75% of its global sales volume derives from selling soda pop. That's part of the reason the company had to admit that its fourth-quarter 2013 revenue fell 3.6% to $11.04 billion.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

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
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, 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
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,079.57 -42.44 -0.25%
S&P 500 1,996.74 -3.38 -0.17%
NASDAQ 4,557.6950 -11.9260 -0.26%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs