I enjoy visiting others’ blogs and reviewing their portfolios. At times my investing approach is validated other times I get a fresh viewpoint. There are occasions when a company that is not on my radar grabs my attention. Such was the case when I ran across Dividenden Investor‘s holdings. In his depot, Coca-Cola Amatil can be found. The name Coca-Cola was the reason for my intrigue and just had to figure out what sort of creature this one was.
Coca-Cola Amatil trades on the Australian exchange under the symbol CCL with their ADR trading in the states as CCLAY. They are one of Coca-Cola’s (KO) anchor bottlers under the 21st Century Beverage Partnership Model that KO is evolving towards. Amatil’s territory includes Australia, New Zealand, Indonesia, Papua New Guinea, Fiji and Samoa. They are a bottler for Coca-Cola products plus liquor (Jim Beam, Maker’s Mark, et.al.), coffees and foodstuffs. Coca-Cola has a 29% ownership.
Coca-Cola Amatil pays a dividend twice per year on an interim/final schedule with franking credits. Recently, the credit has been between 75-100% which translates to no or minimal double taxation for US investors. At yesterday’s purchase price, the dividend yield translates to roughly 5.9%. There is a risk of currency fluctuation as dividends are declared in Aussie$.
This is a continuation of my theory of the US$ being overvalued so my intent is to buy while it’s high and collect increasing dividends through the exchange rate. Of course there’s the risk the US$ will stay strong if a border tax is enacted.