Monday's market upheaval has many an investor scrambling for cover. At midday, the S&P 500 index has shed more than 6% of its value. The broad indexes are reacting to continued uncertainty over the global COVID-19 epidemic, exacerbated by a new oil production war between OPEC members that has sent the price of oil spiraling in Monday trade. 

In this environment, marked by fears of a potential global recession and a seemingly endless string of market downdrafts, it's a great day to buy a safe-haven stock with solid financials, a lucrative dividend yield, and great growth potential -- a stock like global beverage behemoth Coca-Cola (NYSE:KO).

Why Coca-Cola is a smart buy in a fragile market

Coca-Cola spent the last few years transitioning its business model by selling most of its bottling operations to affiliates. This refranchising of a part of its operations (it still produces beverage concentrates) has turned the company into more of a "capital-light" marketer of beverages than a full-fledged manufacturer. Consequently, the organization now sports an operating margin of nearly 29%. You'll find very few large-cap consumer multinationals with this level of operating profitability.

Higher operating profits are translating into generous cash flow. In 2019, Coca-Cola produced $10.5 billion in operating cash flow from $37.2 billion in sales. In addition to funding its capital expenditure requirements, the company uses its excess cash to pay out a handsome dividend -- currently yielding 2.9% annually -- to shareholders.

Close up of glass soda bottles in a bottling plant.

Image source: Getty Images.

Growth and quality will translate into outperformance

If you haven't looked at Coca-Cola's financial statements recently, you'll be presently surprised to learn that under relatively new CEO James Quincey, the organization has emerged from its flattish growth profile. Last year, reported revenue improved by 9% year over year and organic sales expanded by 6%. 

Coca-Cola is finding sales success through a number of initiatives, including the marketing of its reduced-sugar and zero-sugar soft drinks, a focus on smaller packaging architecture including 7.5 oz. mini cans, and a "lift and shift" brand strategy, in which successful beverages are expanded out of their origin geography to other global markets at an accelerated pace.

While widening profitability and climbing sales are desirable traits, in today's environment it's also important to note that Coca-Cola is an entrenched global beverage distributor selling a simple consumer staples product. Localized production of its product around the world minimizes its exposure to supply chain disruptions.

As for the end-users of the company's products, even if the global economy slides into a recession, history shows that in such periods consumers tend to cut down on big-ticket, discretionary items first before reducing spending on food and beverages. In fact, bottled beverage volumes sometimes climb during recessionary periods, as consumers look for indulgent, affordable treats while they cut back on overall household budgets.

Thus, while Coca-Cola may not be immune to economic disruption arising from the COVID-19 outbreak, it is a safe, defensive investment of proven quality, with a strong balance sheet and superior operating characteristics to boot.

On the last day of 2019, I argued that Coca-Cola would outperform the market this year, especially should we fall into a recessionary environment. While it's still early in 2020, the "KO" symbol is indeed benefiting from investors' flight to quality. While the S&P 500 index is down nearly 14% year to date as of this writing, Coca-Cola has slipped by only 5% during the same time period. So if you're in search of a winning investment to help you weather this prolonged market turbulence, today is a great day to play defense and buy Coca-Cola stock.