The 3 Best Beverage Stocks

Seventy-one percent of the Earth's surface is covered by water. It accounts for 60% of our bodies' makeup. And yet, when it comes to the three best beverage stocks, none is solely a water provider.

Instead, each of the three companies on this list focus on a worldwide staple: coffee and tea, wine and beer, and milk. Read on to see which three are the best bets in each realm.

Coffee and tea drinkers everywhereIf you think there's no room left to grow for Starbucks , you'd be wrong. Sure, the company is reaching a saturation point in North America, but it has tons of room to grow in Asia.

Back in 2012, Starbucks bought out Teavana, a rising star in the tea business. It was a shrewd move: Besides water, tea is the most popular drink in the world. We Americans might have trouble believing that, but in China and India -- the world's two most populous countries -- tea is king. And it is in this region of the world where Starbucks is rapidly expanding.

To put it into perspective, look at how the Starbucks store count has grown from 2011 to 2014 in China and South Korea, Starbucks' leading Asian markets.

Starbucks Growth: China & South Korea | Create infographics

This kind of growth cannot be overstated. In just over three years, Starbucks will have tripled its presence in China. And the ability to combine coffee with tea is a crucial differentiator for the company.

Beer, wine and everything that's fineWhile coffee -- and the caffeine that it contains -- may represent the world's most oft-used drug, alcoholic beverages come in a close second. That's why investors would be well-served to consider owning shares of Constellation Brands .

This company traditionally focused on wine through its Robert Mondavi, Ravenswood, and Black Box brands, to name a few. But in 2013, the company bought the rights to several popular beer brands from Grupo Modelo.

These brands include Corona, Modelo, and Pacifico. As a result, revenue from that segment has been a huge boon. While overall volume for beer has been shrinking in America, Constellation saw a 14% bump last quarter.

Photo: Corona

Over the long run, I expect Constellation to be able to leverage the popularity of its new beer brands to further increase volume, while expanding margins and thus profitability.

Though the company's stock has zoomed 630% in the past five years, it is still reasonably priced at 27 times earnings. Furthermore, the company just announced it would be paying out its first ever dividend next month. If the payout remains the same, it will represent a 1% dividend yield.

You've got to get your calciumFinally, let's round out these three selections by focusing on milk. According to the USDA, milk consumption actually fell quite dramatically between the late 1970s and mid-aughts.

Source: USDA

This might lead you to believe that investing in a milk producer would be a fruitless endeavor. And with most companies, I'd say you're right. But with WhiteWave Foods , I believe we have an exception.

WhiteWave is also a producer of non-milk products like Earthbound Farm organic vegetables. But its main focus is in dairy and dairy substitute products, especially those under the Horizon, Alpro, Silk, and So Delicious brand names. Horizon sells organic milk and the other brands offer typical dairy fare, but are made from plant-based source like soy or almonds. This helps eliminate some of the problems that have been arising with individuals who are lactose-intolerant.

The products have been popular with customers. Using data from before the company was spun off from Dean Foods in 2013, revenue has grown at a compounded rate of 17%. That growth accelerated dramatically last year, as revenue jumped 35% between 2013 and 2014, but much of that was from the inclusion of Earthbound Farm and So Delicious, which the company recently acquired.

Moving forward, management sees continued strength, with revenue growing in the low-double digit percentages. With that kind of growth, WhiteWave deserves a look.

The article The 3 Best Beverage Stocks originally appeared on Fool.com.

Brian Stoffelloves Starbucks as a company and a stock, but isn't a huge fan of the company's coffee. The Motley Fool recommends Starbucks and WhiteWave Foods. The Motley Fool owns shares of Starbucks and WhiteWave Foods. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.