MoneyHeavy
Portfolio
Coca-Cola
Coca-Cola <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: KO)") else Response.Write("(NYSE: KO)") end if %>, $67 1/2
Another giant company trading at a whopping multiple. Heck, are we in the
early 70's here, talking "Nifty Fifty" or what? Well, I see two primary
differences today. First, because so much of Coke's business is international,
it isn't unreasonable to consider them a global mid-cap. It may even be a
planetary small-cap, given all the opportunities out there.
Secondly, companies like Coke are managing their capital much more aggressively
and intelligently than twenty-five years previous. Drop your eyes on Coke's
financials and you'll see a business that has been turning over inventory
more rapidly, holding off payments longer, and driving up profit margins
consistently over the past decade. Ten years ago, Coke made around 10 cents
of profit off every dollar. Today, they turn over 21 cents in profit.
The greater efficiencies and the global opportunities are driving our nation's
larger companies to higher valuations these days. Corporate America is taking
the message of enterprise all over the planet.
KO is another stock that may, heck, drop 40% over the next eighteen months.
The MoneyHeavy portfolio will be carrying it for the next ten years, though.
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