Before you make an investment into any company, you would need to first take the time to review and study the financial records of the company. I have been given the opportunity to review the financial records of two major companies; Pepsi Co and The Coca Cola Company and decided which company is more financially sound. In order to make the best choice, I will look at the three financial statement analyses on each company and compare them.
The three tools of financial statement analysis that I will review are the Horizontal Analysis which evaluates a series of financial statement data over a period of time. The purpose of this analysis is to determine the increase or decrease that has taken place. The Vertical Analysis which evaluates financial statement data by expressing each item in a financial statement as a percent of a base amount. Vertical analysis shows the relative size the categories in the balance sheet. It also can show the percentage change in the individual asset, liability, and stockholders’
equity items. Finally the Ratio Analysis which expresses the relationship among selected items of financial statement data. The relationship is expressed by percentage, rate, or proportion (University of Phoenix, Axia College, 2009).
First we will calculate the horizontal analysis for both companies. We look at the percentage change in current asset for Pepsi Co between 2004 and 2005. The percentage change was $10,454/ 8,639= 1.21% or 10,454-8,639/ 8,639= 21% increase. Then we will look at the percentage change in current assets for Coco Cola between 2004 and 2005. The percentage change was $10,250/ 12,281= 0.83% or 10,250-12,281/ 12,281= 16.5% decrease. Based on these calculations, Pepsi Co increased their cur...
... middle of paper ...
...se these numbers also. One more figure that was increased was the software cost. I recommend that they find some cheaper software because the price went from 181 million to 327 million. Some recommendation that I would make to Coca Cola are to decrease the number of outstanding common shares that they have and decrease some of the operating cost.
After reviewing the financial records for both companies, if I had the opportunity I would invest in them both because there is potential with both. Coca Cola seems to be the company that is the most financially sound. If Coca Cola continues to follow the same pattern, I see them being very profitably in the future because from 2004 to 2005 the company has really made some changes in the right direction. If Pepsi Co decreasing the expenses that I recommended, I can see them becoming more profitable than Coca Cola.
The analytical formats used in response to question number 3 are threefold; 1) trend analysis, 2) common size analysis and 3) percentage change analysis. The rationale for this three-fold approach is that all other ratio analysis is derived from these three. The utilization of trend analysis aids in giving clues as to the financial status of the company is likely to improve or deteriorate. Likewise, the common size analysis relates to the fact that all income statement items are divided by
You would not buy a home, car or other large purchases without researching what product offered you the most for your money. The same is true when investing in a company. Investors do avid research on multiple companies to find what company matches the investors' criteria. In this paper Team C will research both AT&T and Verizon's financial documents. Team C will compare selected ratios, cash flow and make recommendations how both companies can manage cash flow for the future.
Financial statements play a significant role in providing insight into Landry’s Restaurants financial condition. Is the liability or cost high and can one see continued improvement in revenues each year are questions answered when analyzing financial statements. An investor can use financial statements in making a decision to invest in a company. By examining the different financial statements, one can identify Landry’s Restaurants has grown over the past five years. Comparing assets, liabilities and owner equity, one is able to determine Landry’s Restaurants is making a profit.
...g changes between October 18th and November 22nd, with $39.24 and $39.87 respectively. The Coca-Cola Company's performance comparative to the industry and to its main opponent PepsiCo has been weak and the future seems trends will remain the same. After lower hopes for the future and a reduction in incomes due to procedure costs and weak sales the company is increasing their asset in the invention research and advertising. The Wall Street Journal reported that the average reply of investment specialists is that "holding" the stock is the best choice for an investor. At this point, as traditional stockholders, Due to the jump in price from $39.24 to $40.39 you would have earned 2.47% on your speculation. In end, the Coca-Cola Co. is a gainful investment. Dependent on the type of depositor, decisions made will control your return on your share with the Coca-Cola Co.
Predictable Profit Instalments, Coca-Cola has paid profits for a long time consecutively, and it has expanded its profit every year. For the main quarter of 2015, Coca-Cola paid a profit of 33 pennies for each offer, which likens to a profit yield of 3.1%. The 33-penny profit instalment for the main quarter of 2015 was an expansion of 8% versus the profit the organization paid out in the final quarter of 2014.In the event that profit instalments proceed with, the organization hopes to pay out an aggregate of $6 billion to financial specialists in
Ratio and Financial Statement Analysis can be seen as a means to an end i.e. Ratio analysis is a financial tool to derive a Financial Statement. Financial Analysis are accounting reports in respect of economic activities prepared periodically to measure the performance of the business. It could also be said to be the analysis established for evaluating the performance of companies. Such criteria are used as parameters in deciding whether the organisation is performing satisfactorily or not. The instrument used for financial Statement Analysis are:
This project displays the evaluation of the financial performance of a publicly traded US Corporation, based on the information that is found. It will include some of the most important financial statistics that that company has on their most recent 10k reports. Once all the financial information of that company has been collected, a conclusion will be drawn based on the finding as well as comparing those stats to the stats of their leading competitors.
It was the researcher’s intent to demonstrate the potential unhealthy financial trends Coca Cola Enterprises has experienced through a financial statement analysis. The financial statement analysis aided in understanding the financial health of this company. By determining the past, present, and projected performance of this company investors, shareholders, managers and other affiliated parties are able to have a better understanding of the risk in investment. The techniques utilized gave a comparison of financial data over a three year span as well as the statistical relationship between that data.
The Coca-Cola company is world wide beverage company. It has an annual revenue of over $45 billion dollars. It is one of the world’s most recognizable brands. The company is the number one nonalcoholic beverage company. Coca-Cola owns, operates and markets more than 500 beverage brands, that range from sparkling water to juice, to of course, soda. These products are sold in more than 200 countries.
PepsiCo is one of the most recognized names in the snack and beverage industry, with brands like Frito-lay, Gatorade, Tropicana, and Quaker, however, it is best known for its flagship soft drink brand - Pepsi and its rivalry with Coca-Cola. To begin, PepsiCo first caught my Interest in the way it manages its business and markets its products. PepsiCo being a relatively young company compared to its rival Coke, has proven to be a formidable opponent going “head to head” with one of the biggest companies in the world (Coca-Cola). Now, when I notice PepsiCo’s growth, the first thing that came to my mind was that it is thanks to its great marketing campaigns, that Pepsi has grown to become the globally recognized brand that it is today. I also admire PepsiCo because I think the there is a high level of entrepreneurship in the way they acquired smaller brands like Gatorade thereby eliminating their competition before they become competition.
a.) Pepsi is a brand far more complicated than just a simple cola product. The company, PepsiCo, has a wide spectrum of marketing perspectives that are vital to the consumers and the company.
While the roadmap for The Coca-Cola Company (TCCC) looks to be bright, the company has built and a great structure to support its business goals. Though they lose certain market share; they do inspire mission, vision and values. The company is committed to a sustainable growth to its shareholders. A culture of improvement, partnership, teamwork shows that TCCC has a solid foundation of open communications and relationships means on which to build its success and growth.
The purpose of this report is to compare financial reports from the two largest soft drink manufacturers in the world. The Pepsi Co. and Coca Cola have been the industry's leaders in their market since the early 1900's. I will use relevant figures to determine profitability, and break down key ratios in profitability, liquidity, and solvency. By breaking down financial statements, and converting them to percentages and ratios, comparisons can be made between competitors regardless of size.
The two companies in the same industry used for this assignment will be Coca-Cola and Pepsi-Cola. These companies are similar because they are in the beverage industry. They were both established in the 1800’s and to this day are expanding more and more. This report will examine the financial analysis of each company as well as different business aspects that they convey such as type of business ownership, how economics affects business, the role of the government in business, leadership styles, motivating employees and promotional and marketing strategies.
...ried to be as successful as his older brother but always fell short. I was completely wrong. Pepsi is not just a soft drink company as I initially thought. Even though Coca-Cola soft drink has a market share of 17% while Pepsi soft drink has a market share of 9%, Pepsi’s stock trades in the mid 80s while Coke’s stock trades in the low 40s. Additionally, Pepsi does well in balancing its mix of net revenue. 49% of its net revenue is generated by its beverage industry and 51% is generated by its food industry. Globally, 49% of its net revenue mix is generated outside the United States. The remaining 51% is generated in the States. Pepsi is the largest food and beverage business in Russia, India, the Middle East, and the United States. They are the second largest in Mexico and gaining ground in Brazil. They have 22 billion dollar brands in estimated annual retail sales.