What if you bought Coca-Cola in 1990?
US Consumer · Drinks. The hindsight answer, year by year, against the only benchmark that matters.
Could you have picked it? Play15.6× · S&P 500 same money: $19,429
$1,000 in Coca-Cola at the start of 1990 would be worth about $15,556 today. A plain S&P 500 index fund over the same years would have made more — the boring option won.
The story
Coca-Cola is perhaps the world's best-known brand, and by the late 1990s the stock was priced accordingly. Under chief executive Roberto Goizueta, who died in 1997, it had delivered extraordinary returns, and Warren Buffett, who started buying in 1988, held it as a forever stock. By 1998 the shares traded at around fifty times earnings, a valuation that assumed growth would continue indefinitely.
It did not. Soda consumption in the US began a long decline as consumers worried about sugar and obesity, and growth abroad could not keep up with the lofty expectations. The stock fell from its peak and then went essentially nowhere for more than a decade, still below its 1998 high in 2010. Coca-Cola responded by diversifying into water, sports drinks, coffee and juices, buying brands such as Costa Coffee and Fairlife, and shifting bottling operations to franchisees. Its dividend kept rising every year, and patient holders were paid to wait, though total returns trailed the S&P 500 over much of this period.
The lesson: A wonderful business bought at an extreme valuation can deliver poor returns for a decade; quality does not protect you from overpaying.
$1,000 invested at the start of each year
| Bought in | Price then | Worth today | S&P 500 would be | Multiple |
|---|---|---|---|---|
| 1990 | $4.50 | $15,556 | $19,429 | 15.6× |
| 1995 | $12.00 | $5,833 | $14,783 | 5.8× |
| 2000 | $29.00 | $2,414 | $4,626 | 2.4× |
| 2003 | $22.00 | $3,182 | $7,727 | 3.2× |
| 2005 | $21.00 | $3,333 | $5,763 | 3.3× |
| 2007 | $24.00 | $2,917 | $4,789 | 2.9× |
| 2008 | $30.00 | $2,333 | $4,626 | 2.3× |
| 2010 | $28.00 | $2,500 | $6,071 | 2.5× |
| 2012 | $35.00 | $2,000 | $5,312 | 2.0× |
| 2015 | $42.00 | $1,667 | $3,301 | 1.7× |
| 2018 | $46.00 | $1,522 | $2,519 | 1.5× |
| 2020 | $55.00 | $1,273 | $2,092 | 1.3× |
green = beat the S&P 500 · red = lost money
Best entry point in our set: 1990, turning $1,000 into $15,556. The S&P 500 from that same year: $19,429.
On this day
Now try it without hindsight. The wheel decides the year and the asset class, you pick the position, ten seconds a pick, and we simulate to today. Coca-Cola is one of 258 positions on the wheel — including the ones that went to zero.
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