Coke Delivers Strong Quarter, But I’m Staying on the Sidelines

Solid Results, Weak Case

It’s quize amazing what Coke is delivering in the current consumer environment! The latest quarterly results are a pleasant surprise: sales rose by 12%, and the full-year outlook got been increased. Still, I wouldn’t add the stock to my portfolio.

Why? A less than 70% price increase over ten years, even with dividends, is too little compared to the S&P, let alone the NASDAQ. The $SPX rose by +250% over the same period, and the $NDX by a whopping +530%. That‘s huge underperformance by Coca Cola.

Buffett got in early enough 40 years ago to benefit from the global expansion of the company; today, in my opinion, Coke is just yesterday’s value.

You can add a few shares to your portfolio as a hobby, but to actually generate returns, any broad-market ETF would likely be the better investment.