The Coca-Cola Co (NYSE: KO)
Bill Ackman recently brought Coca-Cola into a celebrity investor feud, making some investors feel as though KO may be his next target. Bill Ackman is a activist investor that’s known for knocking stocks down a notch when he feels as though the company is running immorally. In a recent spat with Charlie Munger, Ackman attacked KO. Today, we’ll talk about the celebrity investor feud, Bill Ackman’s history, and whether or not Ackman is likely to move to attack The Coca-Cola Co.
Bill Ackman And Charlie Munger Clearly Don’t See Eye To Eye
The feud between these two celebrity investors started with Charlie Munger. In a statement, Munger explained his disappointment with Valeant Pharmaceuticals (NYSE: VRX). In his statement, Munger explained that the practices the company has followed with regard to raising the prices of its drugs have been “deeply immoral”. Ackman didn’t like this statement because he is currently heavily invested in VRX. As a result, he decided to fire back by attacking one of Munger’s larger investments, Coca-Cola. In his statement, he explained that KO, in his opinion is “deeply immoral”. Firing back at Munger, Ackman said that Coca-Coal “does enormous danger to society” by displacing “water children consume with sugar water”. Following these statement, investors are starting to wonder if Ackman will act on these statements by purchasing enormous short positions in the stock.
Ackman Has A History Of Attacking Stocks That He Feels Are Immoral
As an activist investor, Ackman has a history of driving the values of “immoral” stocks down. To do so, he purchases massive short positions. In doing this, he truly believes that he is making the world a better place. There’s one thing in his history that has been incredibly clear; He only fires shots at stocks when he has evidence of their wrong doing. This has been seen in his attacks of JCPenny, Herbalife and more, and is an important fact to keep in mind with regard to the question of whether or not he will attack KO with a massive short position.
I Don’t Think Ackman Will Be Shorting KO Any Time Soon
Ackman’s comments with regard to KO are based in fact and his views on the company are becoming the overwhelming consumer view of the company. There’s no denying the fact that consumers are paying more attention to health than ever before, leading to issues for The Coca-Cola Co. However, it’s important to keep in mind here that while KO may be immoral in the views of some, the company has not broken any laws. More importantly, KO has been incredibly generous to its share holders. With that said, I don’t think that Ackman will be buying any short positions in the stock any time soon. The reality is that while Ackman may not like the company’s products, he’s not buying short positions in big tobacco either. What he focuses most on in his activism is companies that are doing the wrong thing either legally or with regard to their shareholders, and when it comes to Coca-Cola, neither of these is true!
Is There Anything To Be Worried About With KO
There’s no doubt in my mind that KO is likely headed for more hard times. However, that’s the result of changes in consumer habits. I don’t think investors have anything to worry about with regard to an attack by Ackman.
What Do You Think?
Do you think Ackman will attack KO with a massive short position? Let us know your opinion in the comments below!
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