Pepsi

while Pepsi recently announced that it will start merchandising a berry flavored cola, Pepsi Blue, in August. With Vanilla Coke, the company seems to be banking on nostalgia. (John Travoltas character in Pulp Fiction coherent a Vanilla Coke at a 50s themed diner, for example.) Pepsi Blue, on the other hand, seems to be a concerted assay to reach out to the hipper, younger demographic that drinks Pepsis mussiness Dew. And comprehend that demographic has worked. The launch of Code Red, a cherry-flavored version of Mountain Dew, last year helped Pepsi increase its market sh atomic number 18. According to the drink Market Corporation, unit heap for all of Pepsis soda brands (including food Pepsi and Mountain Dew for example) increased 1.3 percent in 2001 while volume for Cokes carbonated beverage brands (Diet Coke, Cherry Coke and fairyland among others) declined by .2 percent. This is a mistake for Coke. Pepsi is going after the right field market. Younger audiences are going to buy more of Pepsi Blue. I dont see any edge in vanilla, says Ted Parrish, co-manager of the Henssler virtue Fund. As of April 30, Pepsi was the funds second-largest holding. The fund does non own Coke. Pepsi is not as pricey Regardless of which soda you like mitigate though, Pepsi seems the better value than Coke right now.

Coke is trading at a nearly 20 percent premium to Pepsi establish on 2002 P/Es even though the ii companies earnings growth rates are nearly identical. (Pepsis are actually a shade higher.) And when you look at revenues, the col is even more dramatic. Coke is trading at 7 clock estimated 2002 sales while Pepsi is trading at 3.5 times 2002 revenue estimates. Both companies are expected to post snub declines in sales this year and an increase of about 4 percent in 2003. Due to this disparity in valuation, Jeff Kanter, an analyst with Prudential Securities, says he has a buy rating on Pepsi and hold on Coke. Prudential does not do investment banking. To be sure,... If you want to get a full essay, magnitude it on our website: Orderessay

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