Two Reasons to Buy Coca-Cola Co. Shares (KO)
Coca-Cola Company (NYSE:KO) shares have only moved 1% higher than the Dow Jones and S&P 500 indexes this year, so why buy now? How about plans to rule Africa and Barry Diller.
Barry Diller, CEO of IAC/InterActiveCorp (NASDAQ:IACI), spent $7.4 million on 120,000 more shares of Coca-Cola Co. (KO) , according to a securities filing made public Tuesday (Nov 2nd). Diller, who has been a member of Coke's board since 2002, now owns 1,131,000 shares of Coca-Cola. But who cares if Diller buys a few shares, he's a billionaire right?
Diller knows a good opportunity when he sees it and for Coke, the future is Africa. Big picture, sales are flat in developed countries and for Coke to keep growing, Africa is it. Have a coke and a smile etc.
(BusinessWeek.com) Piles of trash are burning outside the Mamakamau Shop in Uthiru, a suburb of Nairobi, Kenya. Sewage trickles by in an open trench. Across the street, a worker at a bar gets ready for the lunch rush by scraping the hair off a couple of roasted goat heads. It's about 70 degrees, the sun is beating down, it smells like decay, and it's time for Coke to move some product. Annual per capita consumption of Coca-Cola (KO) in Kenya is 39 servings. In more developed countries like Mexico, which consumes more Coca-Cola than any other country, it runs 665 servings per year. One does not need an MBA to see the possibilities.
Two, in fact, have just walked in. The pair wear short sleeves and jeans. They reach into a refrigerated cooler, grab two Cokes in glass bottles, and pull up two overturned red crates for chairs. Mamakamau Kingori, proprietor, 39, bustles up in a patchwork-quilt apron to take their money. The 500-milliliter sodas cost 30 Kenyan shillings (37 cents) each. As is often the case in Africa, the customers enjoy the drink on the premises, the deposit on the bottles being too dear.