In the fourth quarter, KO generated a profit of nearly $1 billion or 43 cents per share. Excluding one-time charges, the earnings came in at 64 cents per share. Analysts were expecting the company, excluding charges, to make 61 cents per share.

Profits were down some 18% compared to the period last year, but much of that difference can be attributed to sales overseas and currency translation. Revenues in the period totaled $7.13 billion, a bit shy of the $7.52 billion expected.

In the announcement KO stated that they were not content to sit on their laurels and ride out the storm. Instead they want to increase market share by improving brand equity across the globe.

The opportunity for a market leader during a recession can be substantial. Even though pain is felt across the board, the leader in an industry can use downturns in the economy to solidify and build its dominance.

There is truth in the cliché, the strong survive. They do, and not only do they survive, they often thrive. Once a recession ends, weaker competitors are removed from competition and the big players are left to compete on an easier field.

KO has been stuck in the low $40 range since the credit crisis killed stocks in October. Interestingly, KO should have been one of those classic defensive names that benefited from buyers attracted to stable cash flows.

That was not the case for KO, as the stock lost approximately 20% of its value in October alone. The good news is that with such a strong cash flow the company's dividend yield increased to close to 4%.

With today's earnings beating estimates investors need not worry about KO's dividend. It looks to be safe even as the U.S. economy deteriorates. In my opinion, shares of KO are undervalued.

Jamie Dlugosch is a contributor to InvestorPlace.com.