Nevertheless, for the stock to work in the long term, Coco-Cola has to overcome the elephant in the room. It's no secret that obesity, which plagues close to 40% of Americans, have become a global concern. Some countries are more responsive than others. Many states have begun to prioritize ways to address (among other things) beverage consumption, which according to many experts is a key contributor to weight gain. "Liquid candy," as soda is often called, is no longer just a "fun" moniker. In some cases, it's become a life or death situation. Here, too, Coca-Cola is not alone in overcoming this challenge. I don't believe it's coincidence that for both Pepsi and Dr. Pepper Snapple ( DPS), sales volumes were also down. The question, though, is how much investors are willing to risk that Coca-Cola can still thrive in a more health-conscious market.
In that regard, I don't believe that Coca-Cola's management has received enough credit for the fine job it has done in educating consumers about the health effects of its products. The company done this, while at the same time promoting regular exercise. It is taking the obesity issue head-on. But the company hasn't stopped innovating. While looking for ways to offset prolonged weakness in the soft-drink business, the company feels a new product called Coca-Cola Life just might be the answer. It's a new drink that uses a blend of sugar and Stevia, a plant-based sweetener that has no calories. It remains to be seen how well this is embraced by consumers and to what extent it alters the company's nutritional profile. The company's stock price, which is still rich by many standards, makes it clear investors believe that for Coca-Cola it will be business as usual, which means plenty of sales and even bigger profits. From my vantage point, I don't believe volumes can continue to decline and not expect that the stock price will suffer. Granted, it hasn't happened yet and the stock has never really been cheap. But, as they say, there's a first time for everything. At the time of publication, the author held no position in any of the stocks mentioned. Follow @saintssenseThis article was written by an independent contributor, separate from TheStreet's regular news coverage.