Financial Analysis Of Pepsi

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Recommended: Financial Analysis of Coca Cola Company vs PepsiCo

Final Project: Financial Analysis
The best way to determine whether to invest in a company is by reviewing the financial statements of the company. The purpose of this paper is to do a financial analysis and discuss the annual reports for two of the major beverage companies, PepsiCo, Inc. and the Coca-Cola Company, particularly the Consolidated Statements of Income and the Balance Sheets for each company. Both PepsiCo, Inc. and the Coca-Cola Company manufacture and sell bottled water, energy drinks, bottles teas, and soft drinks around the world. There have been many companies over the years that have entered the soft drink beverage industry, but PepsiCo, Inc. and the Coca-Cola Company continue to dominate as leaders in this industry. Many of their beverage products are sold in dine-in and carry-out restaurants.
It is of utmost importance when operating a company or business that all financial statements are accurate. Accurate financial data is needed to get a good picture of how the company is handling its revenue and show how well the company has done in the past. This information is helpful to managers running the company, to investors that may invest in the company, and to creditors who may extend credit to the company. The financial information is also helpful in the company acquiring revenue in the future.
PepsiCo, Inc., best known for its top selling cola, Pepsi, and the Coca-Cola Company, best known for its popular soda, Coke, has dominated the top spots in the beverage industry for decades in the domestic market and also in the international market. Both companies sell their products worldwide.
They have strategically followed a business plan that has kept them on top and created a gap between their company and other c...

... middle of paper ...

...companies experienced in 2005 lower net profits than they did in the previous year of 2004, and they both also showed an increase in operating expenses, resulting in lower net profits. They both showed higher operating expenses in 2005 compared to 2004 and should modify or adjust their operations to help reduce expenses so that their profit margins will begin to increase.
I have financially analyzed PepsiCo, Inc. and the Coca-Cola Company in this final paper. Both companies have been around for many years and have dominated the beverage industry market. The vertical analysis and the horizontal analysis for each company has revealed different financial pictures for each company. Each company had a time of financial profit and a time of financial loss.

References

Weygandt, J., Kimmel, P., & Kieso, D. (2008). Financial Accounting. Hoboken, NJ: Wiley.

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