A quick but comprehensive list of the best coffee stocks to buy in 2021
Coffee, after water and tea, is the most consumed beverage in the world. Since time immemorial, coffee has been a mainstay in the lives of countless human beings and, to many, it's nothing less than an essential good.
Now any investor can tell you that having, investing in, or owning a part of anything that people consider to be essential to their life is one of the surest ways to earn profit. Even owning stocks of coffee, a thing that's basically a routine part of almost every working person's morning routine, is money smartly invested.
But which coffee stocks are the best of the best? Well, for your education and potential investment-making, here are the 7 best coffee stocks to buy this year:
1. Keurig Dr. Pepper (NASDAQ: KDP)
Market Value: $49.64 Billion
As is obvious from the name, this is the company that sells the famed Dr. Pepper cherry sodas that we know and loves. The company we know today is a result of an acquisition by the Keurig Green Mountain of the Dr. Pepper Snapple Group in 2018. Since then, the corporation has been doing quite well in the beverages industry -- providing juices, sodas, and even coffee to Americans and the world.
Their coffee sales in particular have seen great improvement in 2021 -- attributed to the fact that many people have been making coffee at home. The superstar of their products is their namesake machines and coffee packets which provide their people with cafe-quality coffee quickly and in the convenience of their own home.
With a history of coffee roasting that began in the 1980s in Vermont, the company has had a steady trajectory upward and has recently just rebounded from the market crash of March 2020. Income investors also enjoy the continuation of a quarterly dividend and a dividend yield of 2.13%.
2. Starbucks Corp. (NASDAQ: SBUX)
Market Value: $140.87 Billion
What person hasn't enjoyed a Starbucks coffee every once in a while? Truth be told, the massive cafe/restaurant chain has weathered many trials and tribulations over the decades since its founding in the 1970s. Now, the corporation has over 30,000 stores worldwide, enjoys a massive market cap, and pays a regular dividend of 1.61% -- if that's not a worthy reason to invest in a company then nothing is.
One of the main reasons why Starbucks corp. was able to survive and even do well during the pandemic was its seamless transition to a solely take-out and delivery form of transaction. Where other brands struggled -- the company was able to ensure that it was still operational and earning revenue despite lockdowns.
Starbucks shares hit an unprecedented high during April of 2021 and, as restrictions around the world are starting to ease, the company has plans for the opening of more stores in emerging markets and fine-tune operations. Investing in their stocks now will definitely be a wise choice for long-term positions.
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3. Monster Beverage (NASDAQ: MNST)
Market Value: $48.64 Billion
Indeed, the first thing one thinks about when one thinks about coffee stocks. Recently though, the company has been making some exciting twists to coffee that is poised to make waves in the market -- especially among the more flavor-adventurous youth.
Java monster comes in 10 different flavors and is a marriage of coffee, cream, the monster's usual energy-boosting properties. This is one product that's aimed at those who love the taste of coffee but are also looking for something strong enough to give them the energy to last the day.
The company itself was founded in 1935 in California but only began selling energy drinks in the early 2000s. Despite the pandemic, the stocks performed surprisingly well and had it's best numbers yet at the end of December 2020.
And now that Coke has recently announced the pulling of its energy drink brand from the US and Canada, Monster Beverage is being given even more room to take the market.
4. JM Smucker Co. (NYSE: SJM)
Market Value: $14.06 Billion
The company owns several coffee brands including Folgers, 1850, and Cafe Bustelo. They are one of the best players in the home coffee consumption market and are likely to grow with the current spike in coffee drinking.
They are also the owners of Dunkin Donuts' at-home coffee range though are not part of the greater Dunkin Brands Group.
The company is also one of the best options for investors looking for high-dividend-paying companies. The current dividend yield of JM Smucker Co. is 2.64%. Reports showed the stocks performing very well throughout lockdown as at-home coffee consumption was at an all-time high.
The portfolio is also very diversified with products that range from peanut butter to pet food.
5. Coffee Holding Co. (NASDAQ: JVA)
Market Value: $30.03 Million
It's likely you haven't heard of this company yet but, if you're looking for penny stocks to buy and wait out for growth, then this company is for you. Based in New York, the company has a few coffee shops under its belt and a few small coffee brands.
Their main point of interest is providing organically grown and gourmet quality coffee to restaurants and home consumers alike. They also possess brands that manufacture coffee-making barista-level equipment for home use.
These are things that are quite trendy among people now and taking advantage of such a cheap stock can place you in a position wherein you can benefit from its rapid growth.
They have managed to keep the value of their stock growth over the past 6 months and, in January of this year, had a breakout moment -- the value of their stock increased by 10%.
Selling at only $5 per share, this is definitely a penny stock. Investors should know though that as fun as it is to invest in something so fresh to the market and with so much potential, penny stocks are by nature highly volatile. The company is definitely performing well but one needs to do proper research before investing large sums of money for the promise of future growth.
6. Restaurant Brands International (NYSE: QSR)
Market Value: $29.53 Billion
This company owns Tim Hortons, the largest coffee shop chain in Canada. Tim Hortons also has coffee shops in America, Europe, and Asia. They have been around since the 1960s and are often considered an integral part of Canadian culture.
The company's shares bounced back quickly after the crash in March last year. Though profits took a hit due to lockdown, their quick move to take-outs and deliveries saved it from further damage and it definitely did not see the same amount of losses other brands did.
Income investors also gravitate towards the more than 3% dividend the company pays out. It should be noted though that the frequency of payout to investors fluctuates.
On top of dealing with coffee, Restaurant Brands International is also the owner of famous restaurant chains like Burger King and Popeye's Louisiana Kitchen -- offering even greater sources of income now that people are allowed to dine in more and more.
7. Nestle (OTC: NSRGY)
Market Value: $331.95 Billion
Formed in 1905, Nestle is listed as number 33 in the 2016 edition of the Forbes Global 2000 list of largest public companies. The fact is, this swiss company is absolutely massive and is one of the few companies that see annual revenues of $1 billion.
For about 80 years, Nescafe, Nespresso, and other Nestle coffee products have been a strong force in the coffee market and are often the first choice for many people looking for affordable coffee options.
Nestle also works closely with Starbucks and is often approved to package the latter's products for use at home. It is also the largest shareholder of L'Oreal, the world's largest cosmetics company.
Needless to say, investments in multinational and historic companies are stable investments. Recently, the current stock prices of the company have been trading higher than this time last year and are looking to continue on an upward trajectory as the pandemic winds down.
Why are investments in coffee stocks worth it? Well, the fact is it's such a highly consumed beverage that it might as well be considered a staple good -- like water, meat, and bread or rice. Staple goods are essentially considered to be recession-proof, thus, are optimal investments for those looking to secure long-term income.
More so than coffee shops and cafes, the industry has successfully shifted to home-based coffee selling and has etched out renewable income in machines that require coffee pods.
And with social media trends hyping up the need for coffee, chances are the consumer base isn't going anywhere soon. The only choice that remains is how best you, as an investor, will capitalize on that demand. With proper research, a good strategy, and a favorable market, coffee will end up being more than just part of your morning routine.