The Margin: How Kobe Bryant scored a 3,200% return in under 4½ years in a very liquid asset

Kobe Bryant can do little wrong in 2018. The former Los Angels Lakers icon won an Oscar earlier this year and, according to ESPN’s Darren Rovell, the basketball star cum businessman and budding movie mogul saw a roughly 3,200% return on a $6 million bet in sports drink BodyArmor, which Coca-Cola Co. KO, +0.30% took a minority stake in Tuesday.

In March 2014, Bryant acquired a 10% stake in exchange for his investment in the premium sports-drink maker BodyArmor — billed as a healthier alternative to PepsiCo’s Gatorade — which is now valued at $200 million, according to Rovell, based on Coke’s minority investment in the company.

Bryant’s stake hadn’t previously been reported and the precise details of Coke’s agreement also haven’t been disclosed.

Wells Fargo analyst Bonnie Herzog described BodyArmor as “one of the most exciting and fastest-growing brands in the sports drink category,” and she believes the deal gives Coke the opportunity to innovate and accelerate growth across its portfolio. That may be bad news for drink rivals Keurig Dr Pepper Inc. KDP, +1.03%  — which is also a minority investor in BodyArmor — and PepsiCo Inc. PEP, +0.71% , but it’s good news for the 39-year-old Bryant.

Shares of Coke are up 0.7% so far in 2018. By comparison, the Dow Jones Industrial Average DJIA, +1.58% is up 3.4% in the first eight months of the year and the S&P 500 index SPX, +0.79% has advanced 6.3% over the same period.

That said, an investor in Pepsi’s stock would have lost about 4.7% thus far in 2018, while shareholders of Keurig’s stock would have lost 76%. Ouch!

Rovell characterized Bryant’s return in BodyArmor as “the biggest return for a modern-day athlete in the business world in some time.” He noted that LeBron James made $30 million from his investment in Beats by Dre when it was bought in 2014 by Apple Inc. AAPL, +1.46%

Still, Bryant’s recent off-court wins have been criticized in an era of #MeToo and #TimesUp because the athlete was accused of sexual assault back in 2003. Such charges in recent times have felled many prominent figures. Bryant has been adamant about his belief that the encounter was consensual but also has stated that “I now understand how she feels that she did not consent to this encounter.”

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