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Cola is not. The potter's warehouse is one of the worst in Dow




Coke Stock ( KO ) has tumbled 4% in 2019 – about the same as other Dow components UnitedHealth ( UNH ( UNH ) ) and Walgreens ( WBA ) .
It's not a big drop. But it comes at a time when Dow and S & P 500 are each up nearly 12%. And Coke's best rival, Pepsi ( PEP ) is up to 6%.
The company is trying to win more customers with new products, including just launched Orange Vanilla Coke. It has also released several new flavors of Diet Coke in the past year, and it was labeled Coke Zero as Coca-Cola Zero Sugar.
The company has branched out in recent years in other ways. It bought the manufacturers of Glaceau Smartwater and Honest Tea. Coca-Cola also spoke a distribution agreement with the owner of the Fairlife Milk Label and it took almost 20% stake in the energy drink company Monster Beverage ( MNST ) ).

However, despite attempts to diversify, Coke is still a slow growth company. Coke issued a weak forecast for 201[ads1]9. Analysts expect Coke's earnings per share to rise by just 5% on average over the next few years.

Coke & # 39; s acquisition can also damage profit margins this year and add more "complexity" to business, according to Macquarie Research analyst Caroline Levy.

The strong dollar is also expected to hurt Coke this year, CFRA Research analyst Garrett Nelson reported in a recent report.

Multinational companies such as Coke are usually hit by dollar strength because it reduces the value of international revenue. US products are also less competitive overseas when the dollar is stronger.

Although Coke has made a significant effort to spread beyond sugary sodas, the company is still dependent on beverages.

However, Pepsi has found success with snacks. The Frito-Lay business, which owns Doritos, Cheetos and Sun Chips, has typically seen stronger growth in sales and operating profit than the beverage unit in recent years.

Coke does not seem to have much interest in food, though. CEO James Quincey has continuously referred to Coke as a "total drinking company."

Cowen analyst Vivien Azer said in a recent report that the shift away from soda and tea, water, coffee and juice is sensible.

But she also admitted that Coke is likely to be harmed by a downturn in the world economy, and she added that it was a surprise to see the volume of carbonated drinks in the North America market fall in the fourth quarter. This may be a sign that consumers are turning to recent price increases.

Nevertheless, coke may need to do even more in beverages to excite consumers and investors.

It may ultimately mean more booze. Coke began selling Lemon-Do, a fizzy, low-alcohol content drink, in Japan last year. There are no plans to bring that product to the US right now.

Coke has also omitted to launch any CBD-based beverages at present. CBD, the non-psychoactive component of cannabis, has begun to emerge as an ingredient in some products in the United States after the farm has passed.
Corona owner Constellation Brands ( STZ ) has himself invested in Canadian cannabis firm Canopy Growth ( CGC ) ). Canopy hopes to sell CBD and hemp products here in the United States and even create a hemp processing plant in upstate New York.



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