Saturday, September 23, 2017

Coca-Cola and the problem of sugar

Welcome brothers to a new video of my channel brothers in dividends.

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Today in brothers in dividends we'll talk about the Coca-cola company.
It is one of the best companies in the american stockmarket, and has been paying an ever-increasing dividend for 54 years in a row.
Still I'm going to share with you some data that may not be so flattering:
In 2012 Coca-cola announced sales worth 48 billion dollars.
In 2015 this number fell down to 44 billion.
In 2016 it was further reduced to 42 billion.
What is the cause of this?
Among other reasons, it could be due to the pressure on sugar and sugary drinks.
Up until recently there was plenty of support among sugary drink producers for well known but unscrupulous researchers, who defended the use of sugary drinks for example in sports.
Coca-Cola has swiftly changed their tune and has started supporting anti-diabetes and nutrition foundations all over the world.
This is just a small part within the larger paradigm shift in dietary advice towards healthier foods.
This is not the first of such shifts though, in the sixties, there was a strong campaign against saturated fats that changed for example the typical american breakfast:
while in the fifties breakfast was based on bacon and sausages, they shifted towards cereal and milk.
 From mostly proteins they changed towards carbohydrates.
The result of this for the US was that while in the fifties the obese population was less than 12 percent, nowadays this number has risen to over fifty percent.
The same thing happened in the UK, in 1980 only 6 percent of the population was obese. Nowadays it is over 50 percent.
This time though, it seems the departure from sugar is a healthy shift in perception, and Coca-Cola is definitely on board with this change,
 if you look at their advertisements you will notice almost all of them are lately dedicated to their zero sugar products.
The Coca-Cola Company seems to have understood that people care increasingly about their health and nutrition.
So, in conclusion, these are positive strategic changes for a company that was already excellent, so of course I'm interested in investing in it, but not right now since I think it's currently overpriced.
As always, make your own decisions with your money, but whatever you choose, best of luck in your investments!

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