Coca-Cola's Dividend Reign Challenged by Rival PepsiCo

Coca-Cola (KO) is one of the most respected dividend stocks on the market, with a 64-year streak of consecutive payout hikes. Its flagship product started as a local sensation in Atlanta and became one of the world's most recognized products.

Despite its impressive track record, investors may have mixed feelings about holding Coca-Cola. On one hand, it has earned nearly $26 billion in revenue during the second quarter, 9% more than the same period last year, with a consolidated net income of $8.4 billion and an 18% increase.

Coca-Cola's dividend yield is 2.4%, well above the S&P 500 average of 1.1%. Its P/E ratio mirrors the S&P 500 average at 26, suggesting it sells at a fair price. However, comparing Coca-Cola to its rival PepsiCo (PEP) reveals some differences.

PepsiCo has also raised its dividend for 54 consecutive years and offers a higher dividend yield of 4.5%, nearly twice that of Coca-Cola's new investors. Its recent growth in both beverage and food businesses makes it an attractive option, with a lower P/E ratio of 17 compared to Coca-Cola's 26.