CEO on the hot seat: Neville Isdell, Coca-Cola
Isdell needs to move beyond soda pop to generate real growth...it won't be easy.
By Jon Birger and David Stires, FORTUNE writer

NEW YORK (FORTUNE Magazine) - Neville Isdell, Coke's third CEO since 1997, needs to wean Coke off...well, Coke. After years of steady expansion, mostly overseas, soda has become a zero-growth business.

But carbonated soft drinks still account for 85 percent of Coke's profits. Finding businesses with profit margins as sweet as soda pop's isn't easy. And running the world's largest beverage company, with a market value of $100 billion, Isdell has to hit some very big home runs to make any impact.

Opportunities

Isdell's most valuable resource is Coke's massive network of bottlers, which spans some 200 countries. Isdell is launching hundreds of new products, hoping to make big inroads with noncarbonated beverages like Full Throtle and Rockstar energy drinks.

And he appears to be warming to the idea of using Coke's $5 billion cash hoard for acquisitions that would diversify the company into food and other consumer goods.

Stock outlook

Coke (Research) shares have fallen about 20 percent from their 2005 high and now sell for 19 times trailing earnings, on a par with the S&P 500. It's not a terrible price for a stock that typically trades for a premium. But it's hard to see how the company is going to generate any excitement soon. Top of page

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.