If You Buy Coca-Cola With $10,000 in 2025, Will You Become a Millionaire in 10 Years?

Key Points

• Coca-Cola's powerful brand supports its staying power, while allowing the business to consistently raise prices.

• Huge profits help fund a dividend that has increased over 63 straight years.

• Investors want to score huge returns from their holdings, but Coca-Cola shares likely won’t beat the market.

• 10 stocks we like better than Coca-Cola ›

Berkshire Hathaway owns 400 million shares of Coca-Cola (NYSE: KO). Given Warren Buffett's incredible track record of identifying high-quality companies, there's certainly a reason for investors to learn more about this top beverage stock.

Coca-Cola is a highly regarded consumer brand, with hundreds of different drinks served in virtually all corners of the globe. It's wild to think that 2.2 billion servings of the company's beverages are consumed every day.

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The business has its merits, but if you buy $10,000 worth of Coca-Cola shares in 2025, will you become a millionaire in 10 years?

Image source: Getty Images.

Coca-Cola's bull thesis

Many reasons support the argument that Coca-Cola is a high-quality business. The brand is one factor, and it supports the company's economic moat. Coca-Cola has been around for over 100 years. Its customers have grown an affinity for its products, thanks to consistent offerings and effective marketing.

The durable brand is also supported by the industry Coca-Cola operates in. There isn't much disruption or innovation happening in this market, and things don't change much over time. This gives me confidence that the brand will be relevant decades from now. In this way, Coca-Cola is a company Buffett likely views as a "forever" holding.

That brand positioning has resulted in impressive profits. Coca-Cola outsources the heavy lifting of bottling and distribution to third parties, helping it run a leaner operation. In the latest quarter (Q2 2025, ended June 27), the business reported net income of $3.8 billion, translating to a fantastic net profit margin of 30%.

Being able to consistently raise prices helps management offset cost inflation. Favorable pricing added a 5% bump to revenue during Q2. This attractive trait should help Coca-Cola maintain its profit margins as we look ahead.

The company's bottom-line performance directly benefits shareholders. Coca-Cola has raised its dividend for a jaw-dropping 63 straight years. With a healthy dividend yield of 2.91%, the stock can be a top choice for investors seeking a steady income from their portfolio holdings.

Coca-Cola won't generate huge returns

In the past 10 years, the S&P 500 has produced a total return of 286% (as of Aug. 22). Coca-Cola has been a serious laggard. Its shares have generated a total return of just 145%. I think investors can expect much of the same going forward.

That is to say that Coca-Cola won't put up monster capital appreciation. Revenue is projected to increase at a compound annual rate of 4.7% between 2024 and 2027. Earnings might grow slightly faster. But because this is a very mature business, there aren't that many levers the leadership team can pull to boost growth.

To grow $10,000 in starting capital to $1 million would require a 100-fold gain. That kind of return would be life-changing, especially in a 10-year timeframe. However, it's rare and maybe even impossible to find a single company that can rise that rapidly. And investors shouldn't bet the house on one stock having such a big influence on their financial health. Coca-Cola hasn't even come close to a 100-fold gain in the past three decades.

The best thing investors can do is focus on building a well-diversified portfolio of competitively advantaged companies growing at solid rates. This strategy will likely work out well over the long run.

While this is a great business and top choice for income investors, it likely won't beat the market over the long term. And it definitely won't turn $10,000 into $1 million in 10 years.

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Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy.