The Coca-Cola Company (KO): Don’t Miss Out on This Beverage Stock

On the other hand, Dr Pepper Snapple Group Inc. (NYSE:DPS) is trading at a much lower forward P/E (1yr) of 14.25, reflecting that the market doesn’t expect the company to do that well in the near future. As Dr Pepper Snapple Group Inc. (NYSE:DPS) expects its raw material costs to remain high this year, it won’t be easy for the company to meet its earnings estimates.

During the last six months, insiders at Dr Pepper Snapple Group Inc. (NYSE:DPS) sold more than 335,000 shares. Net shares sold by the insiders stood at a massive 36%, depicting that the future doesn’t look that bright for the company. Furthermore, a mean recommendation of 2.8 on the sell side shows that Dr Pepper Snapple isn’t a good buy at this stage.

Conclusion

The Asian market, particularly India, will continue to serve as one of the biggest catalysts for Coca-Cola. In the East Asian market, Thailand, Indonesia and Vietnam are expected to post double digit growth in the second half. The company won’t be able to grow significantly in China amid weak economic growth. Thanks to improved economic conditions, Europe is expected to generate a little more revenue for the company. In the products category, tea, juices and sports drinks will make further inroads, especially in the North American market.

During the last couple of years, Coke has always remained one of the top buys in the industry. The second quarter was a result of some rare events that occurred together, resulting in slightly lower revenue. That won’t happen in the future. The bottom line is that The Coca-Cola Company (NYSE:KO) will continue to outperform its rivals in the future, making it a great buy. Plus, Coke’s low price makes it even more attractive. In short, buy Coca-Cola for an upside of 14%.

The article Don’t Miss Out on This Beverage Stock originally appeared on Fool.com and is written by Waqar Saif.

Waqar Saif has no position in any stocks mentioned. The Motley Fool recommends Coca-Cola and PepsiCo. The Motley Fool owns shares of PepsiCo. Waqar 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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