I would personally choose Coke anyday.
Not cuz it's Buffet's favourite of the 2.. but cuz it's not a sugary-saccharine reminder of fake movie-lines.
1.
PepsiCo might look like a better investment than
Coca-Cola, with higher dividends of
$2.62 than Coca-Cola's $1.22 a share. To note: Their yields match at 2.9%.
2.
52-week
price range of Pepsi Co is wider $77-$90 than Coca Cola’s 36-42 (Double the
difference). This wide difference shows us the volatility and elasticity of
PepsiCo and how it can easily reverse the bullish trend.
3.
Unlike Coca-Cola, which has a heavier presence in global markets (Emerging
Markets like China and India means it is well diversified), PepsiCo is overly
exposed to the US market. PepsiCo although is better brand diversified, as it
can claim a better portfolio than Coca-Cola.
Widely known Lay’s and Doritos, non carbonated drink like Lipton Tea, Gatorade and Quaker Oats.
Widely known Lay’s and Doritos, non carbonated drink like Lipton Tea, Gatorade and Quaker Oats.
4.
Considering Pepsi Co’s high exposure in Russia
and having received its maximum growth from Russia & Brazil, it is a risky
pick at the present situation of the chill between U.S.-Russian ties; therefore
it could create new uncertainty.
5.
Coke outsources it’s business unlike Pepsi Co. Pepsi
Co, therefore has some negative correlation to commodity prices, which is, if
commodity prices rise, then Pepsi suffers.
6.
Coca Cola knows how to adapt, It made a diet
version of it’s classic and has been consistent. Instead of moving from
Carbonated to Healthy Drinks to Snacks.
7.
Coca-Cola is making the right move by partnering
with Green Mountain. In addition, Coca-Cola recently increased its stake in
Green Mountain to 16%.
8.
Next five years, Coca-Cola's earnings are
expected to grow at a CAGR of 6.70%, which is better than the growth of 6.05%
seen in the last five years.
COCA COLA
|
PEPSI
|
|
Market Cap (intraday)5:
|
184.73B
|
134.34B
|
Forward P/E (fye Dec 31, 2015)
|
18.76
|
18.12
|
PEG Ratio (5 yr expected)
|
3
|
2.71
|
Profitability
|
||
Profit Margin
|
18.22%
|
10.35%
|
Operating Margin
|
23.93%
|
15.22%
|
Management Effectiveness
|
||
Return on Assets
|
7.72%
|
8.27%
|
Return on Equity
|
25.78%
|
30.55%
|
DEBT
|
||
Total Debt/Equity (mrq):
|
116.77
|
140
|
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