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Forget Coca-Cola: Buy This Stock Instead

 May 07, 2012 09:29 AM
 

(By Street Authority) Editor's note: The following article was originally published on Mar. 5.

My job as chief investment strategist for Game-Changing Stocks requires me to look for "the next big thing." Sometimes that means I'm looking through obscure government reports to learn about the latest technology the Pentagon is using that could soon make it to a retailer near you. Other times it means I might be on the phone with an executive of a small company with designs on changing the way we fuel our cars -- or treat patients in hospitals.

But sometimes, I see a game-changing product right in front of me. And I just have to tell my readers about how they can profit from it.

You don't have to own shares of Coca-Cola (NYSE: KO) to know that through its worldwide production and distribution network, the company owns some of the most valuable brands in the world. All told, Coca-Cola pours 3% of the beverages served to humanity each day.

And you don't have to work on Wall Street to know that shareholders have done pretty well in the past decade...


 
Coke products aren't the most-consumed liquid overall, of course. Good old H2O accounts for the most amount of servings, then tea. But as far as soft drinks are concerned, Coke and Diet Coke are the No. 1 and No. 2 brands in the world.

A game-changer right in the midst of this "stodgy" industry...
This planet consumes 55 billion beverage servings a day. Globally, the research consultancy Datamonitor pegs the soft-drink market at an eye-popping $216 billion annually. Beverage Digest, a trade publication, puts the value of the U.S. soft drink market at fully $74.2 billion a year.

The beverage industry is extremely large, highly fragmented and intricately complex. Some brands are doing well. Others are -- forgive me -- flat, and a few are on the express train to Donesville.

But the industry view from 30,000 feet isn't so hot. Beverage Digest, in its 2011 rankings, noted that carbonated soft-drink sales fell 0.5% in 2010, which, though still negative, still turned out to be better than the more worrisome declines in 2009 (2.1%) and in 2008 (3%). Soft drinks haven't seen an increase in U.S. sales since 2004, which seems to indicate people are cutting back for reasons other than the lackluster economy. Consumption is, for now, at 1996 levels.


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Rich
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