Tom Gardner: Why I Love This Acquisition

One of the stocks Tom Gardner mentions in this video is Coca-Cola, but don't let the mistakes of the company's past be your only guide to investing today. There is absolutely no question that Coca-Cola has been great to long-term shareholders, but the company faces some new threats to its continued market dominance. We've recently compiled a premium research report containing everything you need to know about Coca-Cola. If you own or are thinking about owning shares in the company, you'll want to click here now and get started!

Brendan Byrnes: One of the nine stocks that you've picked out is Starbucks -- recently some big news, purchasing Teavana, $620 million. Is this a good deal?

Tom Gardner: I think this is a good deal for Starbucks. Teavana is an indication to me that Starbucks, although it has grand vision, and Howard Schultz has always wanted to expand off of the coffee business that is the core profit center for that company for the last 20-plus years, this is a focus that I like, and that is into the world of beverages.

It's coffee, it's tea, and they have juices now that they're building, the Evolution market. Remember, 10 to 15 years ago this was a company that was making Akeelah and the Bee and starting to "deworsify," in Peter Lynch terminology, which means they were starting to attach themselves to businesses that weren't connected to their core.

Think about Coca-Cola back in the 1980s, buying Columbia Pictures with the idea that they could put Coca-Cola cans into every scene of every Columbia Pictures movie, and that ended up being a financial disaster for Coca-Cola, so I love what Starbucks is doing. I love the focus on beverages.

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10/21/2016 4:00 PM
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