What happened

Coca-Cola (KO 0.08%) shareholders lost ground to a declining market last month. Shares dropped 12% in January compared to a 1% downtick in the S&P 500, according to data provided by S&P Global Market Intelligence.

That drop came after a tough year for the leading beverage producer, with shares falling slightly in 2020 compared to the wider market's 16% spike.

A glass of soda.

Image source: Getty Images.

So what

Investors had good reasons to be down on Coke's stock in January. The continuing pandemic threat is still pressuring its business, for one. COVID-19 outbreaks forced additional social distancing measures in parts of the U.S., Europe, and other key markets last month. Coke's sales trends are linked to consumer mobility, which means the beverage giant might report another period of declining volumes in its next quarterly report.

Now what

That quarterly update is set for Feb. 10, and investors are bracing for sales declines of about 5% for the fourth-quarter period. Coke's more focused portfolio, which relies more on away-from-home consumption, should lead it to underperform PepsiCo as it did for most of 2020. The good news is that Coca-Cola will recover as the pandemic threat fades, even if the exact timing is still uncertain.