PepsiCo and Keurig Dr Pepper Shares Grew; Pace Slower than S&P 500 Index.
National Beverage, Monster Notch Big Gains. Retailers Surged.

Pandemic-related challenges for the global Coca-Cola system showed up in the US stock market last year as well. Coca-Cola, and bottlers Coca-Cola Consolidated, Coca-Cola European Partners, and Coca-Cola Femsa all declined last year despite an S&P 500 index that gained more than +16%. During COVID-19 lockdowns, Coke and its bottling system struggled to make up for lost sales of away-from-home occasions (including for fountain and single-serve drinks) which made up half of the company’s global revenue. Coke ended the year down less than -1.0% despite a far steeper mid-year decline that pushed the company’s market cap below PepsiCo’s on an intraday basis in May. Shares of PepsiCo and Keurig Dr Pepper both gained last year, although they each fell short of the S&P 500 performance.

2021 BRINGS NO RELIEF SO FAR. Coke shares continued to decline in 2021 amid reports from four major Wall Street beverage analysts who cut their ratings on the company’s stock due to uncertainty over Coke’s path to recovery from the pandemic. The rating cuts came from RBC Capital, JP Morgan, Guggenheim Securities, and Deutsche Bank. RBC Capital also cut its rating on PepsiCo, as did Evercore ISI, which also cut Keurig Dr Pepper. Shares of PepsiCo and Keurig Dr Pepper had fallen so far this year as of yesterday.

BIG GAINS FOR NATIONAL, MONSTER. Of the beverage stocks tracked by BD, LaCroix- maker National Beverage was the clear winner after a gain of more than 66%. Monster Beverage added nearly $30 to its per-share price, reaching $92.48.

RETAILERS. Almost all retailer stocks tracked by BD turned in strong gains that beat the S&P 500 as consumers replaced restaurant visits, convenience store trips, and workplace breaks with stay-at-home consumption supplied by groceries and e-commerce sellers. Walgreens Boots Alliance was the only retail stock tracked by BD that declined. While Kroger’s share price increased, the stock fell short of the S&P 500 gain. Meanwhile, mainline food and beverage wholesaler United Natural Foods (UNFI) jumped more than +82% given all the increased consumer traffic at groceries.