Sunday, February 22, 2015

Coca-Cola Boosts Their Dividend

     I haven't drank a glass, can, or bottle of Coca-Cola since I bought some stock in the company at the start of 2014.  That hasn't stopped me from benefiting from my second dividend increase in just over a year in this global juggernaut. The company announced an 8% dividend increase this past week, boosting their dividend from $0.305/share to $0.33/share paid quarterly.
      As a Canadian who seeks global diversification through buying US equities in my RRSP, Coca-Cola definitely fits the bill as over half their sales and about three-quarters of their profits are derived outside North America. Their global numbers are very impressive with over 3500 brands, including 20 brands that generate in excess of $1B in revenue.
      The company faces headwinds such as a strong US dollar, tepid growth, and changing public tastes away from sugary drinks. To help overcome these challenges, management has focused on cutting costs, diversifying away from cola into teas and juices, and driving incremental growth through selective acquisitions.
     With the dividend yield hovering around 3.1%,  I'll continue to hold my shares in this dividend aristocrat who has increased their payout for 53 straight years.

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