Quick Verdict
Coca-Cola (KO) is DOUBTFUL to NOT COMPLIANT for observant Muslim investors. The concern isn't Coke or Sprite — those are halal beverages. The issue is that Coca-Cola has been expanding aggressively into the alcoholic beverage market through brand acquisitions and partnerships, and this revenue may cross the 5% threshold depending on how it's measured.
Coca-Cola's Alcohol Problem
Coca-Cola began entering the alcohol category significantly around 2018 and has since:
- Launched Topo Chico Hard Seltzer (alcoholic)
- Licensed brands for Jack Daniel's & Coca-Cola Ready-to-Drink cocktails
- Acquired distribution rights for various alcoholic beverages in multiple markets
- Expanded its Simply brand into alcoholic options
The question is whether this alcohol revenue now exceeds 5% of total revenue. Estimates vary — some analysts suggest it's still under 5%, while others argue it's approaching the threshold. Screening agencies have become more divided on KO in recent years.
Financial Screening
- Debt / Market Cap: ~20-25% ⚠️ (borderline)
- Interest Income / Total Revenue: Under 2% ✅
- Alcohol Revenue / Total Revenue: ~2-5% ⚠️ (disputed)
Screening Agencies' Verdict
- Zoya App — Not Compliant ❌
- MSCI Islamic Index — Excluded ❌
- SPUS ETF — Not held ❌
- Islamicly — Not Compliant ❌
Bottom Line
Coca-Cola has moved from a clear pass to a clear fail on Islamic screens as its alcohol portfolio has expanded. Even if the numbers hover near the 5% threshold, the direction of travel matters — KO is actively expanding its alcohol business, not reducing it. Prudent Muslim investors should avoid it and look for alternative dividend-paying consumer staples that don't have alcohol exposure.
Use our free halal checker to screen KO and thousands of other stocks.
Open Halal Checker →