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stefgal asked: Does coke pass the rulemaker criterion of being the only game in town? What about Pepsi? So many people I know drink it, and it is priced the same in the stores. Is Pepsi really number two?

In short, yes. Both KO and PEP have lost market share recently to Cadbury Schwepps' Dr. Pepper brand, Coca-Cola remains the market leader far and away. Check out this most recent US soft drink market share report:

http://www.cnbc.com/stocks/fullstory.asp?Symbol=KO&id=1094237

The highlights? Coke has 5 of the top 10 brands in the US, while Pepsi has 3. Coca-Cola remains the number one soft drink brand with 20.3% market share vs. 13.8% for Pepsi Cola. Neither Diet Pepsi nor Pepsi One has been able to cut into Diet Coke's leadership in that catergory, and it is the number 3 soft drink in the US. The one bright spot for Pepsi? Mountain Dew is gaining market share and is now the number 4 selling beverage in the US.

Even better for Coke is that when you look overseas, its market leadership widens. Currently, more Coca-Cola is consumed per capita in Mexico than in the US. Coke is better positioned than Pepsi in nearly every country in the world, and the recently completed Cadbury-Schwepps brand acqusition will strengthen market position, especially in Europe. Check the hot-off-the-press KO annual report for worldwide market share and consumption data.

Bottom line: KO stock has been beaten down, it is certainly not the darling of Wall Street it once was, and it may not even be a good investment right now (short-term, anyway). In the long term, however, the company's problems will be overcome and patient shareholders (especially DRiPpers) will be rewarded, in my opinion. At least as far as brand goes, Coca-Cola is definitely the Rule Maker in the beverage industry.

Steve
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