...Coca-Cola VS PepsiCo Carmine Strayer Strayer University Intermediate Accounting III ACC305012VA016-1136-001 Professor Bob A. Wright August 25, 2013 This paper will discuss the financial health and similarities and differences between the two major producers of soft drinks in the United States as of 2013. In order to understand the financial health of the two companies we must first understand the markets, history and products produced by both companies. Both companies were founded in the late l800’s by pharmacists working on their own. Coca-Cola was the first of the companies and its main product Coca-Cola, was invented and introduced to the public in 1886. The beverage was named after two of its major ingredients, Cocaine and the Kola nut. (Bellis, 2013, p. 2) Its first year sales as a fountain drink at Dr. Pemberton’s pharmacy are believed to have amounted to about $50, with a production cost of around $70. (Bellis, 2013, p. 2) Coca-Colas, 2009 Operating Revenues amounted to $30,990 billion with about 74% of that revenue coming from its international operations. (Kieso, Weygandt, & Warfield, 2012, Comparative Analysis Case; Coca-Cola Vs. PepsiCo p. 148) Its core product was and continues to be the carbonated beverage Coca-Cola even though it has acquired a few other beverages companies along the way. Those companies include Sprite, PowerAde and the Minute Maid Juice Company. Pepsi-Cola, the original product of what is now known as one of the major products of...
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... Coca-Cola Contenu I Overview 3 1- Key facts: 3 2- Business description: 3 3- History: 4 4- Major products and services: 5 II Context and Short Economic Analysis 5 III Financial Structure 6 1- Liquidity-and-solvency perspective 6 2- Capital Employed Perspective 9 3- Working Capital Ratio 10 4 Shareholders 11 IV Trend Alalysis 12 1- Coca Cola Company profitability 12 2- Sales and value added 13 3- Management effectiveness 14 V Comparative Analysis 15 VI Financial Cash Flow 18 VII Risk Assessment 21 VIII Recommendation 23 I Overview 1- Key facts: The world around us is changing so fast. Today we must see what kind of things can happen tomorrow. That's what Coca-Cola‘s vision of 2020 is. It creates clear destination for this company business and serves with a "Roadmap" for triumphing together with their pouring out partners. Coca-Cola‘s roadmap starts with a mission, which is lasting. Basic tasks of this company are: „to refresh the world“, „to inspire moments of optimism and happiness“, „to create value and make a difference“. Coca-Cola substantive visions are: people, portfolio, partners, planet, profit and productivity. All these words tell you that Coca-Cola is seeking the best value for all company sectors. They want to be a great place to work. They are bringing high quality products of nonalcoholic beverages. The Coca-Cola’s company reaches for best suppliers, marketing strategies and everything what includes Coca-Cola’s...
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...investments for my client that align with its investment goals would be The Coca Cola Company. The Coca Cola Company has been around for years and everyone enjoys a Coke or a Coke product. 1. Provide a rationale for the U.S. publicity traded company that you selected, indicating the significant factors driving your decision as a financial manager. The significant factors that drove the decision, as a financial manager to look into The Coca Cola Company for my client is that Coca Cola is going to always be around and everyone enjoys a nice cold Coke or Coke product. The Coca Cola Company sells many products world wide. Investing in The Coca Cola Company will offer my client a very high return equity (ROE). “Coca Cola gives investors a very high return on equity (ROE), meaning that for the money you invest your return is typically higher than the industry average. In the case of Coke, it over 19% higher than other beverage or similar companies return. The company has also increased their stock dividend every year for almost 50 years straight.” (http://www.rsstocktips.com/the-coca-cola-company-ko-nyse.php) This study has should that investing is risky, however, The Coca Cola Company has been a solid company to invest in throughout the years. “For example, the company sells more than 500 brands in more than 200 countries and 23 million retail locations.” (http://investorplace.com/2014/02/ko-stock-coca-cola-pros-cons/#.VADekha4lFI) “These products include sparkling and still beverages...
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...The Coca-Cola Company FINANCE Spring 2013 [FNCE 601] February 1st, 2013 | WEMBA38 | Team 17 Mathieu Verbeeck Why has coca cola been so successful in the past? When Douglas Ivester took over the reigns at Coca-Cola in October 1997, he had big shoes to fill – indeed, Goizueta – who passed away earlier in the year – would be remembered as one of the greatest wealth builders of the 20th century: during his tenure as CEO, Coca-Cola’s market value grew from $4.3 billion to $165 billion and an investment of in the Coca-Cola stock would have earned a compounded annual rate return of 33% over the last 10 years. Goizueta’s and Coca-Cola’s success can be attributed to a number of factors. Business Strategy Coca-Cola’s mission is to maximize shareholder value over time. To achieve this mission, The Coca-Cola Company executes a business strategy driven by four key objectives: increase volume, expand Coca-Cola’s share of worldwide nonalcoholic ready-to-drink beverage sales, maximize its long-term cash flows and create economic value added by improving economic profit. Coca-Cola achieves these goals by strategically investing in the high-return beverage business and by optimizing their cost of capital through appropriate financial policies. Marketing To meet its long-term growth objectives, Coca-Cola continues to make significant investments in marketing to support their brands. Marketing investments enhance consumer awareness and increase consumer preference for their...
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...The Coca-Cola Company July 24, 2011 CONTENTS Abstract……………………………………………………………………………………………3 Coca-Cola: An Introduction.……………………………………………………………………....4 Financial Analysis………………..……………………………………………………………..…6 Competition Analysis: Pepsi………………………………………………………………………9 Recommendations………………………………………………………………………………..13 Conclusion…………………………………………………………………………………….…15 References………………………………………………………………………………………..16 Abstract Many international corporations began as small domestic ventures. As businesses grew, corporations saw the many possibilities brought on by expanding operations. Companies began to expand by opening franchises in various cities, yet they knew there was more potential for success if they were to expand their operations even further. Thousands of companies, such as Coca-Cola, chose cities internationally to gain more revenue. The purpose of a corporation is to maximize profits for all shareholders involved. Opening firms abroad allowed Coca-Cola to gain worldwide recognition, which gave them a competitive advantage over other soft drink makers. Now, Cola-Cola is not only recognized, but it is one of the most consumed soft drinks both within the United States and in cities across the globe. Coca-Cola took a huge risk in expanding their operations. However, their success proves that multinational corporations need to choose the right market to venture into and choose marketing techniques that appeal to their consumers. Coca-Cola: An Introduction In 1866...
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...CHU HAI COLLEGE OF HIGHER EDUCATION 2010-2011 SEMESTER 2 BBA 353 STRATEGIC MANAGEMENT Group Case Study Project The Coca-Cola Company Tsang Hoi Ki Chan Ho Yin Fung Tsun Wai Chan Ka Po Yuen Sze Wing Chan Tai Hoi Yan Yue Kan (200826001H, (200826002H, (200826004H, (200826019H, (200826020H, (200826027H, (200926024E, FNE) FNE) FNE) FNE) FNE) FNE) FNE) Abstract This paper is a strategic analysis of The Coca-Cola Company (Coca-Cola), a leader in the beverage industry. Coca-Cola, the world’s leading soft drink maker, operates in more than 200 countries and owns or licenses more than 500 brands of nonalcoholic beverages. The company faces challenges in today’s market because of market changes, socio-economic changes and globalization. An external analysis of the soft drink industry is performed to understand the impact of environment. An internal analysis of Coca-Cola is performed to understand the internal capabilities. The conclusion of this case study emphasizes that the company needs to reduce its dependence on carbonated beverage and diversify its product portfolio into the noncarbonated sector to remain competitive. 2 Table of Contents Abstract .............................................................................................................................. 2 Section 1: Introduction ................................................................................................... 5 1.1 1.2 1.3 Mission and Objectives ..........
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...(802914) | | WORD COUNT: 2914 | | Contents Executive Summary 1 1. Introduction 2 2. Market Analysis 2 2.1 Market segmentation 2 2.2 Market needs 3 2.3 Segmentation potential 3 2.4 Analysis of current and potential competitors 4 2.5 PESTEL Analysis 5 2.5.1 Political analysis 5 2.5.2 Economic analysis 6 2.5.3 Social analysis 6 2.5.4 Technological analysis 6 2.5.5 Environment analysis 6 2.5.6 Legal analysis 6 3. Market Plan 7 3.1 7P strategy 7 3.1.1 Product 7 3.1.2 Promotion 7 3.1.3 Price 7 3.1.4 Place 8 3.1.5 People 8 3.1.6 Process 8 3.1.7 Physical Environment 8 4. Market Feasibility (Ansoff’s Matrix applying) 9 4.1 Market Development (Opportunity) 9 4.2 Market Penetration 10 4.3 Diversity and Product development (threats) 10 Conclusion 11 Executive Summary The new product of Coco-Cola differs from the existing products diet coke. The opportunity of these products is it unique and sustainable market share. To different from both the existing products and competitors, the new product is low carioles and with diversity fruit flavour. The target market is the young and healthy generation. The diet coke already has the sustainable market with royal customers, so it is easy for this type of customers to accept the new product. The sparkling drinks takes the most percentage of the whole soft drink market in Coco-Cola Company’s report, so this may also attract the customers from other segmentation even from the competitors...
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...Financial Statements Analysis Dr. Rimona Palas Caroline LAYANI Id: 94746 Michael WEIMBERG Id: 94852 Nathan BENAMOU Id: 94531 Sebastian KANOVICH Id:799048 I. Executive summary After analyzing the income statement, ratios and strategies of the Coca-Cola Company, we can conclude that Coca-Cola had a continuous revenue growth between the years 2009 and 2011. It is the largest soft drink industry company in the world and therefore stands in a privileged position to face potential crisis. The reason for having our results in the income statement, and thus also in our ratios can be explained by the company’s acquisition and consolidation of CCE’s North American business during the last quarter of 2010. Moreover, another important factor for the decline in equity interest was the sale of the company’s investment in Embonor during the first quarter of 2011. Coca-Cola has been using several strategies. As mentioned above, acquisitions have been an important factor of Coca-Cola over the last 50 years. By acquiring new companies, they were able to eliminate competition, increase their growth and become the market leader of the non-alcoholic beverage industry. Following our calculations, over the past three years, Coca-Cola had an increase in its current liabilities as well as in their “cash to sales”. The debt-to-equity ratio shows that it’s smaller than one, meaning that the company is financed through equity. This low debt-to-equity ratio will usually be preferable...
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...CHU HAI COLLEGE OF HIGHER EDUCATION 2010-2011 SEMESTER 2 BBA 353 STRATEGIC MANAGEMENT Group Case Study Project The Coca-Cola Company Tsang Hoi Ki Chan Ho Yin Fung Tsun Wai Chan Ka Po Yuen Sze Wing Chan Tai Hoi Yan Yue Kan (200826001H, (200826002H, (200826004H, (200826019H, (200826020H, (200826027H, (200926024E, FNE) FNE) FNE) FNE) FNE) FNE) FNE) Abstract This paper is a strategic analysis of The Coca-Cola Company (Coca-Cola), a leader in the beverage industry. Coca-Cola, the world’s leading soft drink maker, operates in more than 200 countries and owns or licenses more than 500 brands of nonalcoholic beverages. The company faces challenges in today’s market because of market changes, socio-economic changes and globalization. An external analysis of the soft drink industry is performed to understand the impact of environment. An internal analysis of Coca-Cola is performed to understand the internal capabilities. The conclusion of this case study emphasizes that the company needs to reduce its dependence on carbonated beverage and diversify its product portfolio into the noncarbonated sector to remain competitive. 2 Table of Contents Abstract .............................................................................................................................. 2 Section 1: Introduction ................................................................................................... 5 1.1 1.2 1.3 Mission and Objectives ..........
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...Financial Analysis Christina Scheier Axia College of University of Phoenix Coca Cola and PepsiCo have been making and distributing soft drinks for over a century. Both companies have survived many hardships, but which one is the strongest? The following report will demonstrate financial information about both companies. I will identify and analyze both companies and determine which company would be the better choice for an investor. Coca Cola and PepsiCo have been competing for a long time in a global market. This report will show what each company has done to build their company and improve their business as individuals and as similar industries. Coca Cola is the largest manufacturer and distributor of non-alcoholic beverage concentrates and syrups in the world. The company has ownerships interests in numerous bottling and canning operations. Finished beverage products are sold in more than 200 countries worldwide. Coca Cola’s major products are: Coca Cola, Sprite, Fanta, Diet Coke, POWERade, Fruitopia, Minute Maid juices, Dasani water and various coffees and teas. Coca Cola was invented by a pharmacist in the year 1886 when he was experimenting for a recipe for headache and an energizer. Nowadays Coke serves as one of the number one recognized brands of the world with a unit sales close to 3200 servings. Coke followed a path of being known as a tonic and a healer with caffeine’s in late 1890’s to being number one beverage in 1900 till present. Subsequently...
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...Coca-Cola Inc. Financial Analysis & Valuation Table of Content Executive Summary and Financial Inputs 2 5 Force Analysis 3 Strategies to Create and Sustain Competitive Advantage 3 Accounting Analysis 5 Ratio Analysis 5 Executive Summary In our analysis of Coca-Cola Inc., we estimate an Enterprise Value of $71.3B and an Equity Value of $60.9B, or a value per common share of $25.16. Given the current share price of $44.28, our recommendation for the stock is a “SELL”. Listed below are our key assumptions for the above valuation as well as the conclusions drawn from the analysis of financial statements that led to these assumptions. Key Estimates and Assumptions: * The estimates for financial inputs for the explicit period 2005 through 2009 are as follows: % | 2005 | 2006 | 2007 | 2008 | 2009 | Sales Growth | 5% | 5% | 5% | 5% | 5% | Cost Of Goods Sold % | 36% | 36% | 36% | 36% | 36% | Selling & Administrative Expenses % | 37% | 37% | 37% | 37% | 37% | NFA/Revenues | 89% | 89% | 89% | 89% | 89% | WCR/Revenues | 0% | 0% | 0% | 0% | 0% | * Percentages applied for the explicit 5-year period are largely in-line with the performance ratios that Coca-Cola experienced during 2003 and 2004. * Over-performance Period: This time period represents a scenario where Coca-Cola will continue to enjoy a competitive advantage, resulting in positive NPV investments through the forecasted horizon. ...
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...Coca-Cola Company Introduction Coca- Cola Company is the world leading manufacturer, distributor, and marketer of soft drinks. It was established after Coca-Cola invention on May 1886 by Dr. Pemberton. This company manufactures about 4000 products and 400 brands using tea, coffee, water, energy drinks, juices and much more. The company’s corporate center of operations is in Atlanta with local operations in more than 200 countries around the world. Only 30 percent of its income comes from within the United States with estimated brand equity of 84 billion dollars relating to more than 50 market share of the global beverage industry. In early 20th century, the company expanded rapidly into some European countries. Major and swift growth worldwide took place after the Second World War II. The African market is targeted the most because of its potential economic growth. The American, European and Asian markets utilized fully that’s why must interest is in African nations because they are undergoing urbanization thus make it easy for this company to distribute its products. Also, the middle-class population is on the rise in Africa hence willing to buy more and more due to increasing income. Coca-Cola Company Organizational Structure The organization structure is so flexible that it can meet both local and global needs. Corporate segment is at the top of the structure; it provides support and directions concerning the formulation of new strategic decisions. It is made up of twelve...
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...Financial Management Instructor: Dr. Daniel Frost The Business Enterprise – BUS508 Strayer University June 12, 2011 Based on your analysis, determine which company is better able to pay current liabilities (debt). Explain your rationale. Based on the analysis of Pepsi Co and Coca Cola Enterprise the company that would be better able to pay current liabilities would be Pepsi Co. The company had retail sales of $108 billion in the year of 2009. In previous years, Coca-Cola would be better to pay current liabilities however the company suffered huge losses in the year of 2008. Pepsi Co has nineteen mega brands that provide revenues in several different markets. Coca Cola has five brands per geographic area. Coca Cola is a large organization that is present in numerous countries around the world. Pepsi Co seems to be better to pay liabilities based upon the several different brands the company provides. If there was an analysis based upon the year of 2010 Coca Cola Enterprise would be better able to pay current liabilities. The company sold $25.5 billion unit cases in 2010 versus the $24 billion in 2009. Coca Cola also had a 13% increase in gross profit and operating revenue. (Coca-Cola, 2011) Pepsi Co in the year 2010 also experienced steady growth in revenue and 12% growth of earnings per share. Pepsi Co continued to deliver top tier financial returns in the year 2010. Pepsi Co Americas Foods provided the largest operating profit of 53% in the year...
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...Organizational Behavior & Human Resource Management ECM62BUS Assessment 2: Individual Business Report Name Date Abstract The role of human resources management is indispensable in Southwest Airlines and the Coca Cola Company. The department has the power of steering the companies to success and greatness. Indeed, this department deserve due attention because of the role it plays in the two organizations. However, the two companies, Southwest Airlines and the Coca Cola Company manage their human resources in somewhat different ways. Some of these ways employed by the company contravenes the conventional way of managing human resources. This paper therefore, made a critical evaluation of the human resources management of the two organizations. Apart from critically organizing the human resources management, the paper also highlights the organizational structure and change management issues in the two organizations. From this analysis, the paper claims that the because the two organizations operate in different industries, aviation industry and hotel industry, the manner in which the human resources management practices are conducted is unique for each of the organizations. It is also noted that each of the organizations has a distinct organizational culture. In the same note, it is observed in this paper that the two organizations have different organizational structure. Because of these differences, the PESTLE and SWOT analyses...
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...Cola Wars Case Study DMBA 630 Marketing and Strategy Management in the Global Markeplace Introduction Carbonated Soft Drinks (CSD) have been around for over a century and now accounts for a $60 Billion market with the average American consuming about 53 gallons a year. Coca-Cola was invented in 1886 by John Pemberton as a “potion for mental and physical disorders.” Asa Candler acquired the formula and began marketing it as Coca-Cola. The first bottling franchise was accorded in 1899 for a sum of one dollar. Pepsi-Cola was invented in 1893 by Caleb Bradham a pharmacist from North Carolina. Pepsi also franchised its bottling operations. Pepsi struggled over the years going bankrupt twice within a decade, first in 1923 and again in 1931. Pepsi competed aggressively against coke offering almost twice the amount of Pepsi for the same price in the 1930s. Coca –Cola or Coke on the other hand was the market leader through the early 20th century with numerous imitators popping up trying to clone Coke. Coke fought back in the courts to aggressively deter imitators and counterfeiters. During the 1920s and 1930s, Coke was marketed to multiple market segments making it available to anyone desiring the brand. Eventually Coke sued Pepsi for trademark infringement in 1938 and lost. Pepsi gained market share and became a titan competitor in the market for CSDs beating out all other brands except Coke. Thus began the “Cola Wars” in 1950 with Pepsi’s aggressive “beat Coke”...
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