Jennifer Saibil, The Motley Fool

Sun, May 25, 2025, 12:29 PM5 min read

• Investors see Coca-Cola as a safe stock to own when there's market and macroeconomic uncertainty.

• The company has an efficient global operating system that's also localized and has low exposure to tariffs.

• Coca-Cola is a Dividend King with an incredible 63-year track record of payout hikes.

• 10 stocks we like better than Coca-Cola ›

Many of today's top growth stocks are trailing the market this year as investors worry about tariffs. Even though the U.S. and China earlier this month announced a deal that postponed the larger part of President Donald Trump's 145% tariffs on Chinese imports (and China's reciprocal 125% tariffs on U.S. goods) for 90 days, the tariff overhang remains. That deal left most Chinese imports into the U.S. facing a still-hefty 30% tariff, and imports from most other nations are still under their new tariff regimes. Many of those countries have responded with tariffs of their own on U.S. goods.

By now, many U.S. companies have offered their initial outlooks for the year ahead: Their views range from not expecting any impact from this trade war to acknowledging that they will have to raise their prices to reflect the costs of those tariffs, but there's uncertainty all over.

These are the kinds of volatile conditions in which stocks like Coca-Cola (NYSE: KO) can soar. The beverage giant is a solid, dependable winner that thrives in many circumstances. Plus, it's a Dividend King, reliable for providing passive income growth. Let's see why it could be an excellent candidate for your portfolio.

With $47 billion in trailing 12-month sales, Coca-Cola is the largest beverage company in the world. But you might not realize that it was struggling for a really long time before CEO James Quincey came on board in 2018 and helped the company get its act together. Lackluster growth started to speed up before the pandemic hit, and the company restructured amid global lockdowns, emerging as leaner and more efficient. It now owns about 200 global brands underpinned by the Coca-Cola label, its core business, which is reliable for high sales. According to Statista, Coca-Cola and one of its many other owned brands, Sprite, have the top two spots in U.S. brand awareness among soft drinks.

There are several reasons investors flock to Coca-Cola when there's uncertainty. People always need to drink, and Coke's beverages are cheap enough for fans to keep buying them even when budgets are tight. It has also experimented with container size and packaging to make sure that servings of its drinks are still available at affordable prices despite inflation and tariff-driven price hikes.