Recently, I’ve been thinking about what else to write about. We’ve covered a wide range of topics – annuities, tax-free bonds, mutual funds, the importance of savings, and 401(k)s.
Although I am licensed to buy & sell individual common stock, I strongly believe that most people should own them within mutual funds. There are a number of companies that have some very interesting stories though. One of them is Coca-Cola.
This is NOT an opinion of Coca-Cola’s stock, or an endorsement – merely some history, which I hope you will find as fascinating as I do.
According to Wikipedia,
http://en.wikipedia.org/wiki/Coca-Cola , the first Coca-Cola recipe was invented in a drugstore in Columbus, GA by John Pemberton in 1885. Pemberton developed it as a non-alcoholic version of French Wine Cola. The first sales were at Jacob’s Pharmacy in Atlanta, GA on May 8, 1886. It was initially sold as a patent medicine for 5 cents a glass at soda fountains. Many people at that time believed that carbonated water was good for your health. Pemberton claimed Coca-Cola cured many diseases, including morphine addiction, headaches, and even impotence (the first “Viagra”?).
Asa Candler acquired a stake in Pemberton’s company in 1887 and incorporated it as Coca-Cola Company in 1888. Due to some controversy in ownership, Candler incorpoarted a second time in 1892 as THE Coca-Cola Company. Coca-Cola was sold in bottles for the first time on March 12, 1894. The first outdoor wall advertisement was painted in 1894 as well in Cartersville, GA.
Although the company grew and even had a celebrity endorsement from baseball star and Georgia native, Ty Cobb http://www.tycobbfoundation.com/ common stock for Coca-Cola never went public until 1919. http://beginnersinvest.about.com/od/investmentbanking/a/aa073106a.htm
In 1919, you could buy one share of Coca-Cola (NYSE – KO) for about $40/share.
However, the price quickly fell to $19 due to a sugar shortage. http://query.nytimes.com/gst/abstract.html?res=990CEEDA1131E433A2575AC1A9619C946195D6CF Times were tough due to World War I. I’m certain many people gave up on this investment, and lost out. Had they stayed invested over the long term, that ONE SHARE of Coca-Cola stock, with splits and dividends reinvested is worth OVER $5 MILLION TODAY!!
Coca-Cola joined the Dow Jones Industrial Average on March 12, 1987.