Coca Cola Stock is a long here

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Traditionally, Coca-Cola Company (NYSE:KOCoca-Cola Company (NYSE: stock has been a sensible long-term investment. However, due to a consumer trend toward healthier food consumption, sales of carbonated drinks have been on the decline since 2005. Despite this, Coca-Cola continues to battle against the tide. However, one wonders how long this battle can continue.

At the time of writing Coca-Cola’s share price sits at $39.71. And looking back over the past 3 months, it has been fairly volatile as it peaked in August at $42.12. It is worth noting that Coca-Cola has such a big command of the beverages industry, that there is little wiggle-room for growth. The volatile nature of the stock is partly due to the competitiveness of the beverage industry, and how sales are strongly linked to partnerships, the weather, and consumer spending power.

For instance during the global recession of 2008, Coca-Cola stock plummeted from $29.63 on February 1st 2008 to $19.55 on March 6th 2009. As faith in the economy recovered, so did Coca-Cola sales, and it has been on a climb from that point to being in the high 30’s in the current economy.

KO stock chart

 

Source: Coca-Cola stock price data by amigobulls.com

Historically, Coca-Cola’s stock tends to do well during the summer months and around global sporting events such as the Fifa World Cup. This is partly due to increased advertising spend, and therefore sales during such events. Coca-Cola’s message of kicking back with a Coke is so well ingrained in society that it is little surprise that such trends are the case.

In order to see what Coca-Cola has in stock for investors, it is worth analyzing the presentation of their new COO at the ‘Barclays Global Consumer Staples Conference’ on September 9th, 2015.

James Quincey is the new COO and President of Coca-Cola. He was confident that Coca-Cola can grow by 35% in the next five years. He attributes this to additional retail value and a growing demand for their distinctive non-alcoholic beverage. Interestingly, he detailed their growth rate projections of a staggering 35% over the next five years. One can look at that in two ways. Firstly, this could be a rhetoric to try and show investors that Coca-Cola is still a strong stock in which to invest. On the other hand, this may be a sign of upcoming aggressive marketing and innovative developments- both good things to look out for in a company.

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