Up 35%, How Long Can Coca-Cola Continue Crushing the S&P 500?

• Coca-Cola stock returned 35% in 2026, its best year since 1996, beating the S&P 500's 14% • PepsiCo's revenue growth (6%) now nearly matches Coca-Cola's (7%), narrowing the gap • PepsiCo trades cheaper (17x earnings) with a higher 4.2% dividend yield vs Coca-Cola's 29x and 2.2% Coca-Cola (KO) stock has returned 35% in 2026, well above the S&P 500's 14%, marking its best year since 1996. But PepsiCo may pose a growing challenge despite its own weak -3% return this year. PepsiCo had posted flat revenue growth for years as tastes shifted, but improvements since fiscal 2025—price cuts and healthier ingredients—have narrowed the gap: its latest quarterly revenue grew 6%, close to Coca-Cola's 7%. That similar growth doesn't justify Coca-Cola's premium valuation: it trades at 29 times earnings versus PepsiCo's 17, while PepsiCo's 4.2% dividend yield beats Coca-Cola's 2.2%. Both are Dividend Kings, though Coca-Cola's streak (64 years) edges out PepsiCo's (54 years). Coca-Cola isn't a sell—its 200+ global brands and forecast 4% 2026 revenue growth should satisfy income-focused holders. But PepsiCo's improving fundamentals, lower valuation, and higher yield make it the more attractive buy, which could limit further upside for Coca-Cola shares.