In the Globe and Mail on Wednesday, March 5 John Heinzl (jheinzl@globeandmail.com) wrote a wonderful article about Coca-Cola on reasons why the stock is a keeper for the long run. For any stock which you own or are looking to buy it is worthy of looking at the following reasons why Coca-Cola has long term value.

1. The dividend keeps rising – Coke has raised its dividend for 52 years.  Their past history is to payout 55% of earnings from their healthy cash flow.

2. It is well diversified company – Coke earns money in every country and 82% of its operating profit comes from outside North America.  Coke has something that every company would love – 17 brands with sales of over $ 1 billion. Those brands include: Coca-Cola, Diet Coke, Coca-Cola Zero, PowerAde, Sprite, Minute Maid and Fanta. This means incredible advantage in distribution, marketing and ensuring the competition is not too powerful in the shelf space of any store.

3. Results were better than they seemed – if you compare 2003 when Coke had net income of $4.35 billion to 2013 of $8.58 billion it is doing something better.

4. The stock is fairly priced. – Coke trades around its historical average of 19 times price to earnings.

5.  The company is not standing still – Coke is spending $400 million on marketing this year, it is continuing to test new products, new lines and when one is successful a global market rollout can easily be done.

Linking to dividend paying stocks, Coke is wonderful about paying a dividend and every year the dividend increases. The article is added because of the reasons Mr. Heinzl gives. As you do your homework on the stocks that you wish to buy – go through the 5 reasons – does it pay a dividend and how long? what is the outlook for the company and its strategic advantages? how are the financial results? is the stock fairly priced? was is the company doing to ensure that results continue into the future?

There are more questions than answers, till the next time – to raising questions