If You Invested $1,000 In Coca-Cola Stock One Year Ago, Here's How Much You'd Have Now

Investors who have owned stocks in the past year have generally experienced some big gains. In fact, the SPDR S&P 500 SPY total return over the past 12 months is 44.1%. But there is no question some big-name stocks performed better than others along the way.

Coca-Cola’s Difficult Road: One company that has been a lackluster investment in the past year has been beverage giant Coca-Cola Co KO.

In recent years, Coca-Cola has been investing in expanding outside its core soda business into higher-growth areas such as water, plant-based beverages, coffees, teas and other drinks. Unfortunately, restaurant, bar and stadium closings in 2020 hit the company’s away-from-home sales hard, creating a difficult environment for Coca-Cola.

In 2019, Coca-Cola generated $2.07 in EPS on $37.2 billion in revenue. In 2020, those numbers dropped to 75 cents and $33 billion, respectively.

The silver lining for Coca-Cola investors is the stock’s 3% dividend, which is more than double the overall yield of the S&P 500. Coca-Cola generated $8.7 billion in free cash flow in 2020, which was more than enough to cover its $7 billion in dividends. In fact, even after an extremely difficult pandemic year, Coca-Cola raised its dividend once again in February 2021, marking its 59th consecutive year of dividend hikes.

See also: How to Buy Coca-Cola Stock

At the beginning of 2020, Coca-Cola shares were trading at $55.32. By the beginning of March, the stock had dropped to $53.93 after news of the virus spreading in China prompted concerns about a U.S. pandemic. On March 23, Coca-Cola stock ultimately bottomed at $36.27. Fortunately, the stock rebounded somewhat from that point on as the broader market recovered.

By early September, Coca-Cola shares were back above $50. But while the S&P 500 has continued to rise since that time Coca-Cola has mostly stalled out.

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Coca-Cola In 2021, Beyond: By early January 2021, Coca-Cola shares had grinded as high as $54.93, but the stock took a big hit when RBC Capital downgraded the stock to Sector Perform and said its “valuation is near-full.” In the note, the analyst said the negative impact of COVID-19 could last longer than many investors assume.

After dipping as low as $48.11 in January following the downgrade, Coca-Cola has spent the past four months marching steadily higher. The stock recently hit a new 52-week high of $55.49 before pulling back to $54.56.

Coca-Cola investors who bought one year ago and held on have generated an underwhelming return on their investment. In fact, $1,000 in Coca-Cola stock bought on May 25, 2020, would be worth about $1,258 today, assuming reinvested dividends.

Looking ahead, analysts are expecting Coca-Cola's stock to continue grinding higher in the next 12 months. The average price target among the 22 analysts covering the stock is $60, suggesting 9.9% upside from current levels.