Coca-Cola is in better shape than its market price suggests. Defensive consumer staple stocks are out of fashion and investors worry about weight-loss drugs, cash-strapped households turning to cheaper private-label goods and the drinks group generally running out of steam after 100-odd years of dominance. Emotions appear to have trumped rationality.
Demand for its long list of world-renowned products, including Coke, Sprite, Fanta, Schweppes, Aquarius, Innocent smoothies, Minute Maid juices, Powerade and Costa Coffee, has remained strong without compromising operating margins. Coca-Cola is increasing prices to offset rising costs and customers keep buying regardless. In the third quarter, its volumes rose by 2 per cent, making it a standout performer in the beverages sector.
The brand’s ability to thrive in a difficult environment underlines the
