Coca-Cola(KO) The Motley Fool·2025-01-27 10:06Core Viewpoint - Dividend stocks have historically outperformed non-dividend-paying stocks, with Coca-Cola exemplifying a strong dividend growth history and sustainable competitive advantages that support its continued success [4][9][12]. Group 1: Dividend Performance - Dividend stocks delivered a 9.17% annualized return from 1973 to 2023, while nonpayers generated a 4.27% annualized return during the same period [4]. - Coca-Cola has increased its dividend payout for 62 consecutive years, with an expected increase for the 63rd year in February 2024 [9][11]. Group 2: Coca-Cola's Competitive Advantages - Coca-Cola operates in nearly every country, allowing it to leverage growth opportunities in emerging markets while maintaining stable cash flow in developed markets [13]. - The company sells essential consumer goods, ensuring consistent demand regardless of economic conditions, as evidenced by being the world's most-purchased brand for 12 consecutive years [14]. - Coca-Cola's marketing strategies effectively engage diverse consumer demographics, utilizing AI and social media to connect with younger audiences while maintaining appeal to older consumers [15]. Group 3: Financial Outlook - Coca-Cola's payout ratio is projected to be around 65% for 2025, indicating a strong capacity for continued dividend increases [16].