Too Late to Buy Coca-Cola? 1 Reason It Isn't.
Key Points
Coca-Cola stock has surged 31% in 2026, but a long growth runway in developing markets suggests it’s not too late to buy.
Only 25% of drinks consumed in developing markets are paid for, providing opportunities to win over new shoppers.
Unit case volume rose 5% last quarter, and the stock offers a 2.3% yield backed by a long history of dividend increases.
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After the stock surged 31% so far in 2026, outperforming the rest of the market, investors might wonder whether it's too late to buy Coca-Cola (NYSE: KO). I don't think so. One reason it's not too late is that the beverage giant still has a long growth runway in developing markets.
CEO Henrique Braun recently noted that in developed markets, 75% of the drinks people consume are paid for, like bottled sodas, juices, and teas. In developing markets, where most of the world's population lives, only 25% are. That's an opportunity to sell more drinks.
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Coca-Cola is well-positioned to capitalize on this opportunity, as it already has a vast global distribution system that enables it to sell in over 200 countries. It owns popular brands overseas, such as Fanta, Del Valle juices, and Thums Up. In India, the company owns seven of the top 10 brands.
Coca-Cola has shown solid execution, driving strong sales volume while keeping its products affordable -- an advantage that can serve it well in winning over more consumers in developing markets. Its large portfolio of brands also allows Coca-Cola to quickly adapt to shifting consumer preferences.
Unit case volume grew 5% year over year last quarter, led by India, China, Mexico, and Brazil. Volume has grown in each of the last five quarters, and management expects at least 5% organic revenue growth this year, excluding currency swings and acquisitions.
The main risk is that developing markets can be volatile, so a rough patch in a big market like India could weigh on volume for a quarter or two. Still, with a dividend yield of about 2.3% and 64 straight years of dividend increases, Coca-Cola stock remains a solid long-term buy.
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John Ballard has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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