Boston Beer Co Inc (SAM), Monster Beverage Corp (MNST), The Coca-Cola Company (KO): Three Companies to Quench Your Summer Thirst

Secret formula to dividend growth

The Coca-Cola Company (NYSE:KO) keeps its secret formula locked away in a vault in Atlanta for good reason. The company has built a mega brand on the back of its cola brand.

However, top line growth will likely remain timid given the cola market is mature. So, Fools should focus on the bottom line instead. The ability to increase earnings is critical for future dividend growth, which is important for income conscious shareholders.

The Coca-Cola Company (NYSE:KO)’s earnings track record is strong. Its earnings per share have grown a compounded 10% annually over the past three years. This allowed The Coca-Cola Company (NYSE:KO) to up its quarterly dividend 10% to $0.28 per share this year, marking the 51st consecutive year of dividend increases.

KO Dividend data by YCharts

The final take

If you’re wondering whether now is a good time to pick up shares in these leading beverage companies, seasonality suggests it is. As more people move up into the middle class in emerging markets, sales of leading brands should benefit, helping deliver more money to beverage bottom lines. Of course, there are never guarantees and stumbles may stall sales along the way. But, as long as populations are growing and summers remain hot, people will keep drinking, making beverages a Fool-ishly interesting idea.

The article 3 Companies to Quench Your Summer Thirst originally appeared on Fool.com and is written by Todd Campbell.

Todd Campbell has no position in any stocks mentioned. The Motley Fool recommends Boston Beer (NYSE:SAM), Coca-Cola, Diageo plc (ADR), Molson Coors Brewing Company, and Monster Beverage (NASDAQ:MNST). The Motley Fool owns shares of Boston Beer and Monster Beverage. Todd is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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