We recently published an article titled Top 12 Stocks to Buy According to Citadel Investment Group. In this article, we are going to take a look at where The Coca-Cola Company (NYSE:KO) stands against the other stocks.
Citadel Investment Group was officially founded by Ken Griffin on November 1, 1990, with $4.2 million in assets under management. By the end of 2013, the fund had expanded to $16 billion, a remarkable growth driven by a combination of advanced computer algorithms, complex financial models, and a highly secretive approach in its initial years. Griffin was an early adopter of quantitative, technology-driven investment strategies, implementing sophisticated methods long before many firms had even integrated basic digital tools. His reliance on cutting-edge technology and data-driven decision-making positioned Citadel as a leader in the hedge fund industry, setting it apart from traditional investment firms. As of Q4 2024, it holds approximately $577.87 billion in 13F securities in its highly diversified portfolio.
Known more commonly as Ken Griffin, Kenneth Cordele Griffin was born in 1968. His interest in finance began early, and while still a student, he started investing from his Harvard dorm room. In 1986, he launched a small hedge fund that leveraged emerging quantitative analytics to guide investment decisions. A year after he earned a Bachelor of Arts with Honors in Economics from Harvard College in 1989, Griffin founded Citadel, which has since become one of the world’s most successful alternative investment firms. In addition to leading Citadel, Griffin serves as the Founder and Non-Executive Chairman of Citadel Securities, a major global market maker.
Citadel was built on the principle that exceptional talent, combined with advanced quantitative analytics and powerful technology, could unlock significant opportunities in capital markets. The firm’s culture emphasizes continuous learning, innovation, and meritocracy, earning it a reputation as one of the best places to work on Wall Street. Today, Citadel manages over $60 billion in investment capital, consistently ranking among the most profitable hedge funds worldwide. Its success has benefited a range of institutional investors, including pension funds, university endowments, hospital systems, and foundations, contributing to impactful advancements in fields such as medical research and scientific discovery.
Citadel Investment Group employs a diverse range of investment strategies, with a strong focus on fixed income, macro, and quantitative trading. Its fixed income and macro strategy, one of the firm’s longest-running approaches, targets interest rate swaps, sovereign bonds, inflation, currencies, emerging markets, equities, commodities, and credit. By leveraging macro and relative value strategies, the firm integrates quantitative modeling, deep macroeconomic insights, and monetary policy expertise to identify opportunities. The research and trading teams work collaboratively, applying both qualitative and quantitative analysis to generate and refine investment ideas.
Additionally, Citadel’s Global Quantitative Strategies (GQS), established in 2012, has rapidly grown into a major force in the industry. Utilizing advanced statistical and quantitative modeling techniques, its agile teams of researchers, engineers, and traders develop and execute investment strategies with precision. Specialization, collaboration, and centralized operations drive efficiency, allowing the firm to run complex strategies at scale. By combining cutting-edge technology with deep expertise, Citadel continues to expand its capabilities and strengthen its competitive position in global markets.
Beyond finance, Griffin has made a profound impact through philanthropy, donating over $2 billion to education, healthcare, and social initiatives. His philanthropic efforts, now coordinated through Griffin Catalyst, have expanded educational access, strengthened medical and research institutions, and supported cultural organizations. His strategic insights also played a key role in the development of Operation Warp Speed, accelerating COVID-19 vaccine distribution. Whether in business or philanthropy, Griffin’s commitment to data-driven decision-making and transformative impact remains a defining characteristic of his career.
Our Methodology
The stocks discussed below were picked from Citadel Investment Group’s Q4 2024 13F filings. They are compiled in the ascending order of the hedge fund’s stake in them as of December 31, 2024. To assist readers with more context, we have included the hedge fund sentiment regarding each stock using data from 1,009 hedge funds tracked by Insider Monkey in the fourth quarter of 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A row of factory workers assembling bottles of sparkling soft drinks on a conveyor belt.
The Coca-Cola Company (NYSE:KO)
Number of Hedge Fund Holders as of Q4: 81
Citadel Investment Group’s Equity Stake: $623.75 Million
The Coca-Cola Company (NYSE:KO), a multinational beverage corporation established in 1892, is evaluating a potential shift toward increased plastic bottle usage in the U.S. due to rising aluminum costs. CEO James Quincey stated that the 25% import tax on steel and aluminum, imposed by President Trump to boost domestic manufacturing, may lead the company to rely more on PET plastic bottles if aluminum prices surge. While packaging costs are a relatively small portion of overall expenses, Coca-Cola is prepared to implement strategies to maintain affordability and consumer demand. Quincey downplayed the tariff’s impact, emphasizing that while it is notable, it will not drastically alter the company’s multibillion-dollar U.S. business. Additionally, the company is exploring mitigation strategies, such as hedging programs and sourcing aluminum domestically.
This possible shift comes as The Coca-Cola Company (NYSE:KO) faces mounting pressure from environmental groups that have labeled it the world’s top plastic polluter for six consecutive years. The company has increasingly leaned on aluminum cans to align with sustainability efforts and appeal to eco-conscious consumers, despite the material’s higher cost. A move back to plastic, even temporarily, could put Coca-Cola at odds with environmental advocates and consumers pushing for reductions in single-use plastics. Despite these sustainability concerns, the company’s financial performance remains strong, with fourth-quarter 2024 results exceeding analyst expectations. Revenue climbed 6% to $11.54 billion, and net income rose 11% to $2.2 billion. Organic revenue grew by 14%, driven by price increases and heightened demand in key markets such as the U.S., China, and Brazil.
On February 25, 2025, The Coca-Cola Company (NYSE:KO)’s Board of Directors approved its 63rd consecutive annual dividend increase, raising the quarterly dividend by 5.2% from $0.485 to $0.51 per share. This brings the annual dividend to $2.04 per share, up from $1.94 in 2024. The first-quarter dividend will be paid on April 1 to shareholders of record as of March 14. In 2024, Coca-Cola returned $8.4 billion in dividends to shareholders, contributing to a total of $93.1 billion in dividends paid since 2010.
Hayden Capital made the following comment about The Coca-Cola Company (NYSE:KO) in its third 2023 investor letter:
“It’s not just emerging markets either, where one could argue a “scarcity premium” given fewer quality public companies. Even in the US, The Coca-Cola Company (NYSE:KO) trades at ~30x P/E despite having the same earnings as 10 years ago.
Both of these companies actually have lower revenues than 10 – 15 years ago too, indicating that their profit growth is mostly from margin expansion. This can only last for so long before there’s no more excess expenses left to cut.
I find it ironic that all these companies trade as “bond-equivalents” in the minds of investors – even commanding lower yields than US treasuries, the safest security in the world. But it’s clear that their businesses are not nearly as safe. Coca-Cola is facing disruption risk from consumers shifting to new, heathier beverage brands.
But these companies are ~35% more expensive than US Treasuries, despite the heightened risk. On a risk-adjusted basis, one could argue the implied premium is even higher.”
Perhaps the explanation is simply the price volatility difference between these stocks and treasuries over the last two years. For example, 10-year Treasury bonds are down ~-20% since the beginning of 2022. By comparison, KO and PG are remarkably down only -4 – 6% over that time frame.”
Overall KO ranks 9th on our list of the top stocks to buy according to Citadel Investment Group. While we acknowledge the potential for KO as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than KO but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.