Coca-Cola is considered a premier defensive stock with a 29% gain year-to-date and 11% EPS growth in Q2, but its premium valuation at 26x forward P/E versus the S&P 500’s 19x and potential tax liabilities of up to $20 billion limit its upside to just 6%. PepsiCo and Keurig Dr Pepper offer alternatives with more attractive valuations: PepsiCo boasts a 4.6% dividend yield and 15x multiple with over 18% upside potential, while Keurig Dr Pepper trades at 13x with 13% analyst upside. Coca-Cola’s bonds represent another defensive option in the current rate environment, offering competitive yields and an A+ rating from S&P.
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