Dividend Aristocrat Overview: The Coca Cola Company

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About The Coca Cola Company

The Coca Cola Company is the world’s leading beverage company with over 500 well-known brands including Minute Maid, Dasani and Powerade in the United States. Coca Cola is headquartered in Atlanta, Georgia and distributes its products in over 200 countries, at a rate of 1.9 billion servings per day. The company employs over 200,000 people worldwide.

The company is a member of the S&P 500 index and Dow Jones Industrials 30 index and is traded under the stock symbol KO.

Note: There are several companies associated with The Coca Cola Company and with similar names that trade under different stock symbols on U.S. exchanges.  These include Coca Cola Enterprises (CCE), Coca Cola HBC (CCH), Coca Cola Bottling Company (COKE), and Coca Cola Femsa SAB (KOF).  The description on this page is specifically regarding the stock traded under the symbol KO.

Coca Cola’s Dividend and Stock Split History

Coca Cola Dividend Growth

The Coca Cola Company has compounded dividends at nearly 8.5% a year for the last decade.

Coca Cola is one of the older members of the S&P Dividend Aristocrats, having increased their dividends for 54 consecutive years as of 2016. The company became a Dividend Aristocrat in 1988. In 2016, Coca Cola raised their annual dividend by 6.1%, from $1.32 to $1.40 per share. The company has a 5 year annualized dividend growth rate of 8.29%, which is slightly lower than the longer-term rates, reflecting the recent slowing of dividend growth. Specifically, over the last 10 and 20 years, Coca Cola has compounded its dividends at annualized rates of 8.49% and 9.00% respectively. Since becoming a Dividend Aristocrat in 1988, KO has compounded their dividend payouts at an annualized rate of 11.02%. KO has usually announced dividend increases in the 1st quarter of the calendar year and has paid quarterly dividends since 1920.

KO has had 11 stock splits since coming public in September 1919, most recently in July 2012.  The company conducted 3 for 1 stock splits in January 1960 and June 1986, and a 4 for 1 stock split in November 1935.  2 for 1 stock splits occurred in January 1965, May 1968, May 1977, May 1990, May 1992, May 1996, and July 2012.  The company also issued a 100% stock dividend in April 1927.   A single share purchased in September 1919 would now be 9,216 shares.  More recently, one share purchased when KO became a Dividend Aristocrat in 1988 – which paid $1.20 in dividends that year – has become 16 shares paying a total of $17.92 in dividends in 2013.

Over the 5 years ending on December 31, 2015, Coca Cola stock appreciated at an annualized rate of 8.60%, from $28.44 to $42.96. This underperformed the 10.20% compounded return of the S&P 500 index over the same period.

Coca Cola’s Direct Purchase and Dividend Reinvestment Plans

Coca Cola has both direct stock purchase and dividend reinvestment plans.  Both are administered through ComputerShare.  The minimum initial investment is $500 and additional investments are required to be at least $50.  The Coca Cola plans have extensive fees to both buy and sell shares through the plan.  The following fees are associated with stock purchases:  a fee of $10 to open an account, a fee on direct cash purchases by check of $3 and a fee on purchases made by direct deduction from bank accounts of $2, along with a per share cost of 3 cents for each of these purchase options.  Fees on dividend reinvestments are 5% of the reinvested amount, up to $2, plus 3 cents per share.  Sales fees are also steep: $25 for a market order or $15 for a batch order (end of day), plus 12 cents per share.  The best way to minimize the per share cost is to buy and sell shares in large batches.

Helpful Links

Coca Cola Investor Relations Website

Current quote and financial summary for Coca Cola (finviz.com)

Information on the direct purchase and dividend reinvestment plans for KO

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