Bad News for Buffett's Favorite Dow Stock

The following video is part of our "Motley Fool Conversations" series, in which industrials editor/analyst Isaac Pino and research analyst Cat Baab-Muguira discuss topics from across the investing world.

Investors might not realize it, but Warren Buffett has made a killing buying tried-and-true Dow blue chips over the years. One of the companies he's been most bullish on since the early 1990s is Coca-Cola. Buffet believes the brand, bottling, distribution, and the global reach of the company provide a sustainable competitive advantage. He also adores Coke's signature product, and consumes several sodas on a daily basis.

For Buffett and Coke, however, some troubling news broke this week when the city of New York announced a proposed ban that would virtually eliminate popular sugary drinks larger than 16 ounces from deli menus, fast-food franchises, and even sports arenas. This regulation takes the soda tax concept and raises the bar another level, at a time when Americans are consuming less soda every year. If passed (which looks likely at this point), the ban could cause a ripple through the soda industry. Can Coke grow if its core products lose their fizz?

Coke's already combed the world over for opportunities, but there are other great brands just gaining traction in the race for global dominance. To uncover these picks today, we invite you to read a copy of our free report: "3 American Companies Set to Dominate the World." The report won't be available forever, so we invite you to click here to get your copy today!

At the time thisarticle was published Cat Baab-Muguira has no positions in the stocks mentioned above.Isaac Pinohas no positions in the stocks mentioned above. The Motley Fool owns shares of International Business Machines, JPMorgan Chase, and Coca-Cola.Motley Fool newsletter services recommendCoca-Cola. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.

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