Final 12 months, I took two Buffett shares and put them face to face: Coca-Cola (NYSE: KO) and Domino’s Pizza (NASDAQ: DPZ). Coca-Cola is Buffett’s longest-held inventory, and Domino’s is a reasonably new addition. And whereas their enterprise fashions are totally different they usually function in numerous industries, they’re each main shopper items shares that supply worth to traders.
I recommended that Coca-Cola was more likely to be the profitable inventory in 2025, and I used to be proper. Can it proceed? Let’s revisit the talk and see who may win in 2026.
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Neither Coca-Cola nor Domino’s beat the market final 12 months, however Coke inventory got here fairly shut, whereas Domino’s remained almost flat.
Once I selected it final 12 months, I famous the corporate’s longer observe document of reliability and its increased dividend yield. I felt on the time that these options can be essential to the market in 2025, because it was coming into a brand new 12 months after two years of double-digit good points.
Ultimately, progress received out, and the market delivered a 3rd consecutive 12 months of double-digit good points, however Coca-Cola bought excessive marks anyway for its stability and native manufacturing within the face of rising tariffs.
Now that the market is coming into a brand new 12 months after three years of double-digit good points, does this thesis nonetheless maintain true?
Coca-Cola has been performing nicely over the previous 12 months, and its localized manufacturing is incomes it a thumbs-up from the market.
In the newest quarter, which was the 2025 third quarter (fourth-quarter earnings can be launched on Feb. 10), gross sales elevated 5% 12 months over 12 months, and comparable working margin rose from 30.7% to 31.9% 12 months over 12 months. The corporate has pricing energy, and it has been capable of sustain with increased prices by elevating costs in addition to altering packaging and dimension. It continues to see methods to turn into extra environment friendly and launch new merchandise, and its mannequin of buying international manufacturers provides new income sources.
It additionally stands out for its dividend. Coca-Cola is a Dividend King, and it has raised its dividend for the previous 63 years straight, rain or shine. The dividend usually yields round 3%, however right this moment it is 2.9% as a result of the inventory has carried out so nicely.
Domino’s has been reporting comparable mid-single-digit gross sales progress lately, however the market hasn’t rewarded it. World retail gross sales elevated 6.3% 12 months over 12 months within the 2025 fiscal third quarter (ended Sept. 7), with comparable gross sales up 5.2%. Eating places on the whole have been underneath stress within the high-inflation atmosphere, although pizza is a meals that is low-cost and resilient. The market could also be seeing extra restricted upside for Domino’s proper now given continued stress.
