Sample Essay On The Coca –cola Company
The New York Stock Exchange (NYSE) is the largest equities-based exchange in the world dealing with the buying and selling of its capital securities listed on the market. NYSE has a lot of companies trading on it worldwide. One of these companies is the Global operating Coca –Cola Company, which began trading on NYSE since 1919. Coca-Cola deals on non-alcoholic soft drinks and it market its product worldwide (Parker, 2014).
Like any other trade, risk is part and parcel of the system only the degree of risk is what differs. The same is applied to the case of NYSE. Investing in this stock is also accompanied by higher risk challenges followed by higher benefits and returns. For instance, those companies trading on NYSE are faced with the challenges such as lack of liquidity. Consequently, investors are not able to convert stock into cash thus buyers and sellers are not able to complete a trade. The problem occurs mostly during after normal trading hour when there are less trading volumes for stock exchange hence making it difficult to execute some of the trades (Fama, French, Booth & Sinquefield, 2014).
Again investors are faced with the problem of price volatility where they experience greater price fluctuations than in the regular trading time or during the normal operation of the day. Traders are also facing the risk of competing with more professional traders who own large companies and have high access to information than the individual investor hence making it hard to individual investors to access the buyers easily. Furthermore, investors get the risk of uncertain prices. The prices of some stock after normal day work may not reflect actual prices during the regular hours of trade hence the traders get exploited. NYSE also does not allow the investors to see or act upon quotes hence the investors do not know quotes the firm is using after working hour thus creating avenues for exploitations of buyers and sellers in the market.
According to researchers, Coca-Cola Company emerges as the largest soft drink selling company in the world. It sells 3500 product worldwide and it also licenses and market more than 500 soft drinks brands across the carbonated and non-carbonated beverage group. Its main competitor is Pepsi Company that adjusted its EPS to about 1.12 dollars but when compared to coca cola, the latter was still ahead of every player in the industry.
The company is experiencing a faster growth compared to its competitors. For instance, it has covered and sold it products to more than 200 countries worldwide. In addition to the recent merger between Coca-cola and Monster Beverages, leading energy drinks company in the world. It is estimated that the coca- cola shares will be the fast growing global energy drinks market due to this new deal. As part of this new plan, coca- cola will transfer its brands to monster, while the Monster to give its non-energy portfolio to coca cola so as to optimally realign products hence making the coca collar company to grow faster and cover a wider area than before(Fama, French, Booth & Sinquefield, 2014) .
Energy drinks sales grew by approximately5.5% in US in the year 2013 due to the low current levels of penetration and large –scale promotion and advertisement. Consequently, domestic and foreign markets have recently developed the taste for the coca-cola products of the company hence pushing it grow faster (Parker, 2014).
The coca cola company is highly profitable. Coca -Cola earning increased in the past six years indicating that its grow even though it has faced a lot of challenges .In the past few years coca cola have been increasing and shown a 43.32% increase over its 2007 earnings. The profitability has made the shareholders to double their net return thus its profitability.
During the past 13 years, Coca- Cola price-to-earnings ratio was 23.33.But during the last six months it price-to-earnings ratio per share grew by 2.7% per year. Thus, it shows that the company only takes one year to earn back the price they paid for the stock hence it facing a rapid and a faster growth rate. The Coca –Cola Company has a dividend. The latest dividend information showed the company had a stock trades of 38 dollars and they paid 45 dollars in dividend over the period of one year which means 46 dollars per quarter thus the company's' dividend yield was 6%.
The future of coca-cola company indicates a lot of success. With the merger between the company and Monster Beverage Company, a lot of net return to the company is expected to double in the future. Again the move by the company to decide to invest five billion dollars with a bottling partner in Africa by 2020 shows how the company's future is promising. In an attempt to increase the sale of its fruits –based drinks in Africa, the coca- cola company announced the partnership with alcoholic beverage company SABMiller and South Africa's Gutsche's Family Investment so as to create Coca-Cola Beverages Africa. With boost and partnership, the company stands to succeed in the future.
Coca-Cola Company is trading on New York State Exchange under the sticker symbol KO. It is highly recommended that these company to stock as an investment for investors that are considering stock investment. This recommendation will widen the sources of finance creating avenues for getting other funds that are required to run the business operations. Again engaging in the stock investment helps the company to increase its strength in operating its assets hence promoting good managements (Parker, 2014).
Although there is high-risk trading on New York State Exchange, it is one of the best stock exchange companies in the world. The NYSE offers fair and convenient environment for trade to take place between buyers and sellers hence it has made some companies such as coca-cola to thrive in their industries. The most important thing an investor require trading on NYSE is the terms of trade and how to get the crucial information regarding the type of business you are interested in trade. Like Coca -Cola Company, any company can trade on the New York State Exchange so as to derive the benefits other companies are getting.
Fama, E., French, K., Booth, D., & Sinquefield, R. (2014). Differences in the Risks and Returns of NYSE and NASD Stocks. Financial Analysts Journal, 49(1), 37-41. doi:10.2469/faj.v49.n1.37
Parker Hannifin celebrates 50 years of trading on NYSE. (2014). Filtration + Separation, 52(3), 6. doi:10.1016/s0015-1882(14)70082-5
Tanne, J. (2013). Coca-Cola launches antiobesity advertisements. BMJ, 346(jan23 2), f494-f494. doi:10.1136/bmj.f494