Stock Market Investing - Assignment Example

Stocks investing: Coca Cola and Exxon Mobil Despite a stock price is a well-known index for a company, not the companies with highest stock prices are worth of investing in the first place. There are many much more important factors like a positive dynamic in companies’ income, dividends companies provide for their shareholders etc. However, even when looking for a company with “best results”, the business is still risky due to many different economic, political, geographical and other factors easy to miss.

Among three pairs of stocks, Coca Cola and Exxon Mobil seems most worth of investing with a view of their stock performances, dividends, and businesses they are in.This first pair of stocks belongs to companies involved in consumer non-durables (Coca Cola) and energy (Exxon Mobil) industries primary. Oil production is a world-known powerful business worth on investing. Nowadays all the geopolitics is somehow connected to energy sources, because without energy no production’s possible. However, this also brings specific risks.

Like many oil companies, Exxon Mobil relies on oil from often unstable (politically, economically) regions. Thus, any geopolitical events can influence the stock prices. Coca Cola Company is an enterprise, working world-wide for many years, so there’re not many chances Coca Cola would bankrupt as consumer non-durables industry generally, is developing. However, Reeves admits that in 2015 when interest in bearing assets may be back, it would “rotate a lot of capital out of low-growth, low-dividend stocks like Coca Cola” (Reeves).

Second pair of stocks (General Electric and Pepsi) looks pretty much like the first one, yet when looking into history of stock performances on NASDAQ, General Electric shows a poorer dynamic comparing to Exxon Mobil. Meanwhile, Exxon Mobile has their dividends growing during several last years, and though this year prices are decreased comparing to 2014, one can expect they rise along with profit. Coca Cola has generally stable dividends for 3 years with slight increase and performs better this year comparing to 2014.

Pepsi performs with increasing success for the last years, increasing stock price and dividends too. Thus, it’s General Electric’s performing (too stable to earn money) what drags Pepsi down with. In third pair, Procter and Gamble has shown a decreasing trend during last months, and despite their dividends are increasing from year to year, other pair member, General Motors has only one year of dividends practice. Thus, it can be concluded that Coca Cola and Exxon Mobile pair is the best choice, despite Pepsi alone seems the best performer.

Company SymbolCompany Day 1 Stock PriceCompany Day 5 Stock PriceProfitCoca Cola$39.81$40.55$0.74Exxon Mobil$83.52$85.20$1.68Generally, if one had truly bought Coca Cola and Exxon Mobiles stocks at the beginning of this week, during this week a principle of “buy low, sell high” could by applied because prices were growing during last 5 days. Comparing stocks prices when open, and 5 days later when closed, Coca Cola’s one has raised for $0.74. As it’s not a significant raise perhaps there were no great factors to cause this change.

Meanwhile, for Exxon Mobile day 5 price has raised higher and made $1.68 profit. CNBC reports that oil market isn’t stable now as Greece situation causes concerns: either country will manage its contracts with creditor, or there will be a default. Further improving on oil trade will result from European summit on Monday (Cheng). Works CitedCheng, Evelyn. “Stocks close lower amid options expirations; Greece concerns weigh”. CNBC. 19 June 2015. Web. 20 June 2015.

Reeves, Jeff. “Opinion: 10 biggest risks to the stock market”. Market Watch. 5 December 2014. Web. 20 June 2015.