Always Coca-Cola? That’s the thinking! Many consumers should always have the ability to buy a can of coke – even in a recession. That’s why many investors see Coke as a recession buster!

Coca-Cola earnings were very good in April: sales surged 16% to $10.5 billion, beating Wall Street’s expectations of $9.8 billion. Profits of $2.8 billion, or 64 cents a share, rose 24% from a year ago — surpassing consensus estimates of 58 cents a share.

Furthermore, despite rising aluminium prices and other inflationary forces noted the company has a strong outlook for the rest of the year. The ‘recession proof’ label that Coke has may also attract further investment. It is also noteworthy that Warren Buffet is a big backer in Coke stoke and he currently has 400 million shares!

Over the last 10 years Coca-Cola has lost value only once between May 24 and July 21. The average return has been +2.82% and the maximum return has been over 7.16% at 11.74%.

Does that mean Coca-Cola shares will gain again this year? Are they a good recessionary proof play?

Major Trade Risks: Any bad news for Coca-Cola stock will negate this outlook.

HYCM clients can access the Seasonax product in order to analyse over 25,000 currency pairs, indices, commodities, as well as individual stocks. Please contact your account manager for a free trial. Certain products & services mentioned herein may or may not be available to all clients depending on which HYCM Capital Markets Group entity their trading account(s) adheres to.