Four Reasons Why Coca-Cola Stocks Are Buying, Says Jim Cramer

CNBC’s Jim Cramer said on Thursday that investors should add shares of Coke to portfolio.

“So far, in a very bad year for the stock market, Coca-Cola has been one of the really consistent winners out there. These guys were already putting in huge numbers when inflation was insane in the first quarter,” he said. Told.

“Now that many of their core costs have dropped dramatically from their high levels. … I think Coke’s results will only get better,” he said.

,mad MoneyThe host said there are four reasons he believes investors should snatch Coke shares. First, the company is a recession-proof play because people will continue to drink pop regardless of the state of the economy, he said. Told.

“It’s exactly the kind of company we love here that makes the real stuff, turns a profit, and returns profits to shareholders through dividends and buybacks and also has fair valuations versus historical pricing,” They said.

He also pointed out that Coke would benefit from the reopening of the economy as people who stayed inside during the pandemic are eating out and ordering Coke products with their meals.

Cramer also said the company’s venture into alcoholic beverages would boost its balance sheet. Coke announced partnership In June with Jack Daniels distiller Brown-Forman to create a canned Jack-and-Coke cocktail. The company already has Topo Chico Hard Seltzer and . has launched Simply Spiked Lemonade with Molson Coors Beverages,

But the top reason Coke stock is attractive is because the company is overcoming inflation, Cramer said.

Coke Wall Street beats expectations on earnings and revenue in its first quarter, but saw higher costs for key supplies such as aluminum, high fructose corn syrup and plastics.

However, the price of corn is down about 27% from its April highs, including a drop of about 23% over the past three weeks, Cramer said. He said aluminum is down about 41% from its peak in March.

He acknowledged that a stronger US dollar is still a headwind for the beverage giant.

“It means their foreign earnings translate into fewer greenbacks. Not good, but currency volatility is much easier for Wall Street to ignore than raw cost inflation,” he said. “

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