The number of registered shareholders in the soft drink company last year fell for the first time in more than a decade to 380,581 from 394,603 at the end of 1999, according to information in the company's annual reports. The number had grown steadily from 95,952 in 1989. Moreover, an increasing number of the company's shares are being held by institutional investors, such as mutual funds. Five years ago, investors accounted for about 55 percent of Coca-Cola's shareholder base. That figure has increased to about 63 percent, according to data supplied by Bloomberg News.
Some companies believe a large number of individual shareholders adds stability to a stock.
By trading in smaller blocks and at a slower pace, individuals don't cause as much volatility and are more willing to consider a company's long-term performance, the thinking goes. Investors flocked to Coca-Cola's shares when it was a virtual money machine. For example, during the decade of the 1980s, per-shareincome from continuing operations more than tripled, and the company's stock price increased almost seven fold. So investors were willing to pay premium prices for the stock. But the company's luster has faded along with its sales and profitability.