Pepsi vs Coca Cola

Coca-Cola verses Pepsi Financial Comparison

In this paper I will discuss the financial differences between Coca-Cola and Pepsi and show how their stocks differ in the stock market today. I will tell you which company I would personally buy stock from today if I would in the market to buy.

Coca-Cola and Pepsi are both financially sound companies in the food and beverage industry. Coca-Cola was incorporated in September 1919 under the laws of the State of Delaware. The company manufactures, distributes and markets nonalcoholic beverage concentrates and syrups. It also manufactures, distributes and markets finished beverages (www.sharebuilder.com, 2009). Pepsi was incorporated in Delaware in 1919 and was reincorporated in North Carolina in 1986. It is a global beverage, snack and food company. The company manufactures or uses contract manufactures, markets and sells a variety of salty, convenient, sweet and grain-based snacks, carbonated and no carbonated beverages and foods in approximately 200 countries with its operations in North America, Mexico and the United Kingdom (www.sharebuilder.com, 2009).

According to the attached financial statement Coke and Pepsi are mostly competitive with only a couple of areas with differences. Cash and cash equivalents represents 11.7% of Coke’s assets but only 5.7% of Pepsi’s. This could be explain that Pepsi is offsetting this by their net receivables being at 13% vs. Coke’s 7.6% which could occur for many reasons based on their movement of money throughout the year. This money could move back and forth between the cash and net receivable but on the financial statement.

The next major difference would be the difference between the companies’ capital structures. While Pepsi is split debt and equity percentage is 66.2/33.8, Coke’s is 49.5/50.5. While the capital structures seem to not be so far off what you have to look at would be the short term debt and see that it only represents 1% of Pepsi’s balance sheet...