Tech stocks are back in fashion, and value shares that soared last year when investors turned to safer stocks are no longer feeling the same love. That includes the iconic beverage company Coca-Cola (KO), which offers a secure dividend and continues to demonstrate growth and innovation. Yet, the stock is still down 3% this year.

Of course, that's not a big dip, and investors know Coca-Cola is reliable for long-term gains. Let's see what to expect from the soft-drink giant over the next three years.

The best of the new and the old

Coca-Cola is known for its eponymous cola brand in regular, diet, and several other iterations. But you may not realize that it actually owns about 200 brands, and that was trimmed down from around 400 prior to the pandemic.

The 200 that were cut were mostly local brands that didn't add a lot to total company revenue, and management decided to focus its resources on its core, high-revenue brands. Aside from Coke, these include names like Sprite, Dasani water, Costa Coffee, and Minute Maid juices. The company doesn't report separate metrics for each brand, but it did say that 26 of these brands produce at least $1 billion in revenue.

While it weeded out underperformers, it's still adding to its brand collection and innovating with new beverages. This is vital to its continued success since people's tastes change over time, and Coca-Cola has to respond to trends to stay relevant.

Coca-Cola's most recent acquisition was BodyArmor in 2021, and it's possible that it will acquire other beverage companies over the next three years. Meanwhile, it recently launched Fuze Zero Sugar in European markets.

Three years from now, the brand lineup shouldn't look too different, but there will be new flavors and beverage types. Some of these new drinks can become the next core drinks, and Coca-Cola is always experimenting to meet and generate demand.

More markets to conquer

The strategy that goes hand in hand with developing new drinks is capturing more market share in more regions. Management says that it still has a small portion of market share despite its recognizable brands you'll find in almost every grocery and convenience store worldwide. It has nearly 30% of the market in developed countries, but only about 10% in developing markets.

Its categories are also growing organically, with ones like hot beverages, sparkling beverages, and juices each expanding in the mid- to high-single-digit rates. What was a $650 billion addressable market opportunity in 2017 became a $1.3 trillion market in 2022, and Coca-Cola is gaining market share. This trend should continue over the next three years.

Slow and steady growth

Coca-Cola organic revenue, or sales from existing products, increased 11% year over year in the second quarter of 2023. Performance has heated up since it restructured in the wake of the pandemic and increased prices to battle inflation. Prior to that, it was beginning to sag. Still, it has delivered organic revenue growth of 7% on average over the past five years, with comparable earnings-per-share growth of 6% and average growth in free cash flow of 14%.

It's likely to continue with a similar pattern over the next five years as well. CEO James Quincy said that the company has a lot of "levers to pull" to keep it running smoothly, and between its huge distribution network, global facilities, brand power, and pricing structure, it's not likely to get knocked down from its perch as the largest beverage company anytime soon.

It's all about the dividend

Coca-Cola is known for its dividend, which yields 2.8% at the current price. It's usually closer to 3%, and management has raised it for the past 61 years, making it a Dividend King. It's incredibly reliable for passive income and dividend growth, and I don't know if anything could put a stop to that momentum. A global pandemic and sharp sales decline in 2020 certainly didn't.

Coca-Cola isn't a growth stock, and it hasn't always outperformed the market, dividends included. However, it's a safe bet for value and steadily growing dividends. That rock-solid stability, along with close-to-market gains, could be a perfectly good reason to invest in Coca-Cola stock.