Business Week’s Gene Marcial Recommends COKE
Source: http://ceoblogger.wordpress.com/2008/09/18/business-weeks-gene-marcial-recommends-coke/Posted on Thursday, September 18th, 2008 | In Stocks to Watch
Business Week’s Gene Marcial Recommends COKE in these difficult times.
Track his picks at:
http://trackthepros.com/stocks/category/404
a. Not many stocks were left standing when the Dow Jones industrial average crashed by 504 points on Sept. 15—the worst drop since the September 11 terrorist attacks. One stock that did stand firmly was Coca-Cola (KO), the world’s largest soft drink company. When the tsunami-like wave of selling was done on that frenzied day, Coca-Cola’s stock stood at 54.75, up from the previous session’s closing price of 54.50.
b Buffett’s Beverage – Wall Street appears to have rediscovered Coca-Cola. Of the 17 analysts who follow Coke, not one recommends selling the stock, and all but two tag the stock a buy.
c. What has caught the eye of analysts of late is the company’s fruit juice and noncarbonated drinks, including energy drinks that come in the form of “vitamin water.”
d. Sales this year are expected to jump 15%, helped by increased prices on some of its products.
e. Overseas markets and new products are good growth engines for Coke. And expanding its drink portfolio in China, even as the severe earthquake in that country hurt Coke’s second-quarter earnings, is a very positive move,
f. Room to Expand
Clearly, there is still a lot of room for Coke to expand in foreign markets. And new products in either fruit juices or vitamin/energy drinks will help bolster Coke’s growth strategy. Some of Coke’s brands in these categories include Evian and Dasani bottled water, Rockstar energy drink, glaceau vitaminwater, and Powerade sports drink.
In all, Coke appears to have the formula for stronger growth. And in these scary times in the market, its stock continues to be a stalwart.
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