Soft drink giant Coca-Cola (KO 0.91%) has struggled since the COVID-19 pandemic. As of Dec. 1, 2025, the stock has underperformed the S&P 500 (^GSPC 0.53%) market index in the last five years:
With a 6.9% compound annual growth rate (CAGR) in this period, Coke lagged far behind the broader market's 13.6% CAGR. And the underperformance doesn't go away if you look at total returns instead, where Coca-Cola's strong dividends were reinvested in more stock along the way:
KO Total Return Level data by YCharts
The gap narrows a bit in this analysis, reflecting the value of an above-average dividend yield. Today, for example, the average S&P 500 stock offers a 1.1% annual yield. Coca-Cola's stock runs circles around that figure with a yield of 2.8%. However, that wasn't nearly enough to outweigh a weak stock chart in the pandemic era and beyond.
Image source: Getty Images.
Coca-Cola by the numbers (the sweeter kind)
Coca-Cola is an above-average investment in many ways. You already saw the strong dividend, with a 64-year streak of annual payout increases. Its return on equity (ROE) stands at 45% -- nearly double the S&P 500 average at 27%.
You can buy this high-quality stock at 24.9 times trailing earnings (S&P 500 average: 28.5). Only 0.9% of Coca-Cola's shares are on loan to short-sellers (S&P 500: 2.3%) and the average analyst rating is a tad closer to strong buy than buy. In the leading market index, the average Street rating leans a little closer to the buy side.
NYSE: KO
Key Data Points
Why the fizz has gone flat
Rising competition and a global focus on healthy foods have limited Coca-Cola's business growth in recent years. And you can't really call Coke an artificial intelligence (AI) stock, even though the company has included AI-based themes in its advertising and flavor development since 2023. So it's no surprise that the stock is underperforming the S&P 500 right now, as the AI boom seems to drive every growth spurt that matters.
That being said, Coca-Cola remains a world-class brand portfolio. Beyond its namesake flavor, the company makes household-name beverages like Sprite, Fanta, Minute Maid juices, Dasani bottled water, and Powerade sports drinks. And don't forget about the popular diet and zero-sugar versions of the core soft drinks. This broad stable positions Coca-Cola to compete even in a health-conscious market.
