Why Are Two Beverage Giants Interested in Greek Yogurt?

The Coca-Cola Co (NYSE:KO) has lost some of its appeal during the second quarter, as the number of funds invested in the company has decreased to 62, from 65, while the value of their investment dropped by 10% to $19.5 billion. According to our database, their combined holdings accounted for 11.4% of the company’s common stock at the end of June. Coca-Cola’s biggest fan is none other than the legendary Warren Buffett. Berkshire Hathaway reportedly holds 400 million shares of the beverage company, which also make it Buffett’s second largest equity position. Donald Yacktman, the manager of Yacktman Asset Management, also holds a significant stake: 30.5 million shares, down by 22% during the second quarter.

So far this year, the Coca-Cola stock has spent most of the time in the red, but the recent rally could propel it above the $42.26 level at the start of 2015, with shares ending yesterday’s session at $42. The company is set to release its next financial report on October 21. Analysts are projecting revenues of $11.5 billion, while earnings are expected to be at $0.50 per share.

Our data show that smart money doesn’t like PepsiCo, Inc. (NYSE:PEP) as much as Coca-Cola, as there were only 57 funds that reported long positions as of the end of the second quarter, down from 61 at the end of March. Their aggregate holdings had a value of $7.08 billion, down by 11% from the first quarter, and represented just 5.1% of the company’s common stock. Activist investor Nelson Peltz holds a significant position in the beverage giant that amassed 18.3 million shares at the end of June. Billionaire Ken Griffin sees great upside potential, having boosted his stake in PepsiCo by 150% during the second quarter. In its latest 13F filing, Citadel Investment Group reported ownership of 1.85 million shares.

PepsiCo announced third quarter revenues on October 6, beating market expectations for the third consecutive quarter. Revenues came in at $16.3 billion, down by 5.1% year-over-year, while earnings were at $0.36 per share. Adjusted earnings stood at $1.35 per share, beating Wall Street estimates of $1.26 a share. So far this year, the stock has been trending sideways and has ended yesterday’s trading session at 99.14, up by 4.4% year-to-date.

Disclosure: none.