Sunday, June 22, 2014

Non-Alcoholic Beverage Stocks for the Summer

Many people are non-drinkers of alcoholic beverages. So what do they drink instead of beer and wine, besides water? Soft drinks, soda, pop, and soda pop. Whatever you call it in your part of the country, large numbers of consumers are still drinking a huge amount of soft drinks, especially now that summer is here with picnic season. This, in spite of the criticism that the manufacturers are taking because of the sugary content of these drinks. Even the tax attack threat of sugar drinks.

Coka Cola (KO) is transitioning towards more healthier beverages along with the other major soft drink  producers. The company just reported a year-over-year 7.5% earnings reduction, on a 4.2% drop in revenues. The stock sports a 22 price to earnings ratio, and trades at 19 times forward earnings. Coke pays a 3% yield.

The biggest competitor of Coca Cola is Pepsico (PEP), which trades at 20 times trailing earnings and 18 times forward earnings. Revenues for the latest quarter flat, however  earnings spiked 13.1%. This company also pays a yield of 3%.

Dr. Pepper Snapple Group (DPS) is another big player in the Beverage pool. It trades at 18 times trailing earnings and 16 times forward earnings. Earnings for the quarter were up an incredible 46.2%.  It pays a yield of 2.8%

According to the list at, there are over a dozen beverage stocks to choose from. Several of these stocks pay dividends.

Disclosure: Author owns KO.


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