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Assignment 3: You Are an Investment Analyst

As the representative from your accounting firm or practice, you are in charge of stock market analysis that will be presented to clients as part of professional consultation process. One of your high-profile clients is trying to determine the possible investment potential between two companies. However, before you can recommend investments to clients, you need to familiarize yourself with the background of the companies, analyze stock trends, research current events, and analyze financial statements. Select one (1) pair of these companies and conduct your analysis.

  • Pepsi versus Coca Cola, or
  • Amazon versus eBay

Write an eight to ten (8-10) page paper in which you:

  1. Analyze each company’s history, product / services, major customers, major suppliers, and leadership and provide a synopsis of each company.
  2. Based on the stock price for the timeline listed below, present a graph that illustrates the stock price of each company. Indicate conclusions that can be drawn based on the trend:  
    a. The day of its initial public offering
    b. January 1, 2012
    c. January 1, 2011
    d. January 1, 2010
  3. Research and summarize at least two (2) news events (this may include mergers, acquisitions, or political issues) that occurred from 2010 to the present day and the potential impact on the stock price of each company. Indicate how this influences your investment decision related to the company. 
  4. Provide an overall financial analysis for each company that highlights the key characteristics for investment and how this may impact an investor’s decision. 
  5. Based on your review of the financial data for each company, indicate the accuracy and reliability of the data for making investment decision. Provide support for your conclusion. 
  6. Recommend which company you consider as the better investment for your client and how you will present your recommendation. Support your recommendation with data from your analysis.
  7. Use at least four (4) quality academic resources in this assignment. Note: Wikipedia and other Websites do not quality as academic resources.

Your assignment must follow these formatting requirements: 

  • Be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides; citations and references must follow APA or school-specific format. Check with your professor for any additional instructions. 
  • Include a cover page containing the title of the assignment, the student’s name, the professor’s name, the course title, and the date. The cover page and the reference page are not included in the required assignment page length. 

The specific course learning outcomes associated with this assignment are: 

  • Analyze the accounting for corporation requirements related to stock valuation, dividends, and retained earnings.
  • Determine how to value investments and how to report them based on that valuation.
  • Use technology and information resources to research issues in financial accounting.
  • Write clearly and concisely about financial accounting using proper writing mechanics.

Click here to view the grading rubric for this assignment.

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Pepsi versus xxxxxxx Cola

 

Analyze each xxxxxxx history, product xxxxxxx xxxxxxx major xxxxxxx major suppliers, xxxxxxx leadership and xxxxxxx a xxxxxxx xxxxxxx each company.

Introduction

 

On xxxxxxx other hand xxxxxxx was founded xxxxxxx Caleb Bradham xxxxxxx xxxxxxx Bern xxxxxxx had a xxxxxxx fountain in xxxxxxx drugstore, xxxxxxx xxxxxxx used to xxxxxxx his customers xxxxxxx drinks which xxxxxxx had created xxxxxxx "Brad's drink" xxxxxxx later renamed xxxxxxx xxxxxxx Cola xxxxxxx 1898 because xxxxxxx the main xxxxxxx pepsin xxxxxxx xxxxxxx nuts used xxxxxxx manufacture. The xxxxxxx of PepsiCo xxxxxxx in its xxxxxxx foods and xxxxxxx which has xxxxxxx xxxxxxx about xxxxxxx billion and xxxxxxx its employee xxxxxxx which xxxxxxx xxxxxxx 142,000 in xxxxxxx The other xxxxxxx of the xxxxxxx includes frito-lay, xxxxxxx Quaker foods xxxxxxx The company’s xxxxxxx xxxxxxx are xxxxxxx in nearly xxxxxxx countries and xxxxxxx PepsiCo xxxxxxx xxxxxxx in 1965 xxxxxxx the merger xxxxxxx Pepsi-Cola and xxxxxxx Tropicana was xxxxxxx in 1998 xxxxxxx PepsiCo merged xxxxxxx xxxxxxx Quaker xxxxxxx Company, including xxxxxxx in 2001. xxxxxxx is xxxxxxx xxxxxxx customers. PepsiCo’s xxxxxxx is the xxxxxxx of their xxxxxxx products, high xxxxxxx standards, distinguishing xxxxxxx strategies and xxxxxxx xxxxxxx reliability xxxxxxx their people.

Based xxxxxxx the stock xxxxxxx for xxxxxxx xxxxxxx listed below, xxxxxxx a graph xxxxxxx illustrates the xxxxxxx price of xxxxxxx company. Indicate xxxxxxx that can xxxxxxx xxxxxxx based xxxxxxx the trend:  

a. The xxxxxxx of its xxxxxxx public xxxxxxx xxxxxxx 1, 2012

 

Coca xxxxxxx border="1" cellpadding="0" xxxxxxx style="width:170px;height:22px;">

Date of xxxxxxx style="width:170px;height:22px;">

Stock price

January 1, xxxxxxx style="width:170px;height:31px;">

28.50$

January xxxxxxx 2011

34.99$

 

Pepsi

 

On xxxxxxx IPO

10.71$

65.33$

January xxxxxxx style="width:197px;">

66.35$

 

Vertical Analysis

Coca Cola

Date of xxxxxxx colspan="2" style="width:394px;">

On xxxxxxx IPO

40$

January 1, xxxxxxx xxxxxxx style="width:197px;">

60.80$

65.33$

January xxxxxxx style="width:197px;">

34.99$

Name xxxxxxx the company

On the xxxxxxx of IPO

Jan 1,2011

Jan 1,2012

Diff. xxxxxxx xxxxxxx &2010

Dif. xxxxxxx 2011 &2012

Coke

40

32.89

34.99

-28.75%

15.40%

6.38%

 

Although Coke xxxxxxx seen xxxxxxx xxxxxxx coming down xxxxxxx nearly half xxxxxxx 1998, its xxxxxxx rival, PepsiCo xxxxxxx seen its xxxxxxx price rise xxxxxxx xxxxxxx low xxxxxxx $35 to xxxxxxx high of xxxxxxx with xxxxxxx xxxxxxx percentage of xxxxxxx rise vs. xxxxxxx fall of xxxxxxx - which xxxxxxx Pepsico’s 10 xxxxxxx trend of xxxxxxx xxxxxxx behind xxxxxxx Pepsi internationally xxxxxxx concentrates of xxxxxxx Pepsi, xxxxxxx xxxxxxx and other xxxxxxx for sale, xxxxxxx also markets xxxxxxx distributes juices xxxxxxx the trademark xxxxxxx Tropicana in xxxxxxx xxxxxxx and xxxxxxx over. In xxxxxxx PepsiCo is xxxxxxx engaged xxxxxxx xxxxxxx snack and xxxxxxx segment all xxxxxxx way through xxxxxxx Frito Lay xxxxxxx in domestic xxxxxxx international regions. xxxxxxx xxxxxxx Coca-Cola, xxxxxxx is also xxxxxxx an attempt xxxxxxx get xxxxxxx xxxxxxx rapidly growing xxxxxxx of non-carbonated xxxxxxx sector with xxxxxxx current acquisitions xxxxxxx South Beach xxxxxxx Co. and xxxxxxx xxxxxxx SoBe xxxxxxx of herbspiked xxxxxxx energy, and xxxxxxx drinks, xxxxxxx xxxxxxx the most xxxxxxx Gatorade sports xxxxxxx through a xxxxxxx acquisition of xxxxxxx Oats Co. xxxxxxx Pepsico company xxxxxxx xxxxxxx making xxxxxxx marketing the xxxxxxx selling brand xxxxxxx ready-to-drink xxxxxxx xxxxxxx teas all xxxxxxx way through xxxxxxx joint venture xxxxxxx Lipton and xxxxxxx the share xxxxxxx on the xxxxxxx xxxxxxx IPO xxxxxxx we can xxxxxxx that the xxxxxxx price xxxxxxx xxxxxxx cola has xxxxxxx initially but xxxxxxx has shown xxxxxxx increasing trend xxxxxxx a constant xxxxxxx while Pepsico xxxxxxx xxxxxxx other xxxxxxx has increased xxxxxxx during the xxxxxxx phase xxxxxxx xxxxxxx now showing xxxxxxx constant trend xxxxxxx gradual increase. xxxxxxx the initial xxxxxxx of each xxxxxxx the companies xxxxxxx xxxxxxx say xxxxxxx Pepsi has xxxxxxx better investing xxxxxxx than xxxxxxx xxxxxxx but at xxxxxxx same time xxxxxxx we consider xxxxxxx stock price xxxxxxx of the xxxxxxx few years, xxxxxxx xxxxxxx clearly xxxxxxx that Coca xxxxxxx has a xxxxxxx upward xxxxxxx xxxxxxx Pepsi.

Research and xxxxxxx at least xxxxxxx (2) news xxxxxxx (this may xxxxxxx mergers, acquisitions, xxxxxxx political issues) xxxxxxx xxxxxxx from xxxxxxx to the xxxxxxx day and xxxxxxx potential xxxxxxx xxxxxxx the stock xxxxxxx of each xxxxxxx Indicate how xxxxxxx influences your xxxxxxx decision related xxxxxxx the company. 


Regarding this xxxxxxx xxxxxxx the xxxxxxx had a xxxxxxx opinion as xxxxxxx whether xxxxxxx xxxxxxx stock was xxxxxxx or not. xxxxxxx the stock xxxxxxx many people xxxxxxx of the xxxxxxx that its xxxxxxx xxxxxxx actually xxxxxxx at a xxxxxxx which was xxxxxxx its xxxxxxx xxxxxxx When the xxxxxxx of coke xxxxxxx considered overrated, xxxxxxx customarily meant xxxxxxx the investors xxxxxxx have to xxxxxxx xxxxxxx than xxxxxxx actual value xxxxxxx the share xxxxxxx this xxxxxxx xxxxxxx risk which xxxxxxx investors were xxxxxxx ready to xxxxxxx After the xxxxxxx split many xxxxxxx found the xxxxxxx xxxxxxx and xxxxxxx buying.

 2. COCA xxxxxxx COLLABOARTION

Another recent xxxxxxx of xxxxxxx xxxxxxx cola company xxxxxxx the collaboration xxxxxxx the company xxxxxxx one of xxxxxxx retailing giants xxxxxxx which includes xxxxxxx xxxxxxx of xxxxxxx brand into xxxxxxx events all xxxxxxx the xxxxxxx xxxxxxx festive occasions.

PEPSI xxxxxxx New Strategy: xxxxxxx Products

The U.S. xxxxxxx of the xxxxxxx had steadily xxxxxxx xxxxxxx its xxxxxxx of the xxxxxxx soft drinks. xxxxxxx reason xxxxxxx xxxxxxx same was xxxxxxx the health xxxxxxx of the xxxxxxx who had xxxxxxx obesity problem xxxxxxx the other xxxxxxx xxxxxxx the xxxxxxx of the xxxxxxx beverages in xxxxxxx market. xxxxxxx xxxxxxx result Ms. xxxxxxx of Pepsico xxxxxxx on the xxxxxxx and decided xxxxxxx reframe the xxxxxxx She said xxxxxxx xxxxxxx have xxxxxxx and therefore xxxxxxx to modify xxxxxxx product. xxxxxxx xxxxxxx same spirit xxxxxxx started focusing xxxxxxx on their xxxxxxx products like xxxxxxx juices, teas xxxxxxx sports drink. xxxxxxx xxxxxxx selling xxxxxxx of Pepsi xxxxxxx U.S. became xxxxxxx and xxxxxxx xxxxxxx it trailed xxxxxxx its soft xxxxxxx sales, The xxxxxxx started leading xxxxxxx world in xxxxxxx teas through xxxxxxx xxxxxxx its xxxxxxx brand Tropicana xxxxxxx winnning in xxxxxxx The xxxxxxx xxxxxxx now taken xxxxxxx big step xxxxxxx healthy foods xxxxxxx its Quaker xxxxxxx Gatorade and xxxxxxx sections. The xxxxxxx xxxxxxx started xxxxxxx Global Nutrition xxxxxxx to bring xxxxxxx advanced xxxxxxx xxxxxxx said that xxxxxxx new Group xxxxxxx the Global xxxxxxx Group is xxxxxxx of their xxxxxxx policy to xxxxxxx xxxxxxx nutrition xxxxxxx from the xxxxxxx day revenues xxxxxxx about xxxxxxx xxxxxxx to $30 xxxxxxx by 2020. xxxxxxx furtherance to xxxxxxx goal the xxxxxxx has hired xxxxxxx renowned nutritionists xxxxxxx xxxxxxx their xxxxxxx to reduce xxxxxxx sodium and xxxxxxx in xxxxxxx xxxxxxx Lay’s potato xxxxxxx have already xxxxxxx the content xxxxxxx sodium by xxxxxxx … and xxxxxxx the year xxxxxxx xxxxxxx will xxxxxxx made from xxxxxxx natural ingredients.

  1. Provide xxxxxxx overall financial xxxxxxx for xxxxxxx xxxxxxx that highlights xxxxxxx key characteristics xxxxxxx investment and xxxxxxx this may xxxxxxx an investor’s xxxxxxx Coca cola xxxxxxx xxxxxxx have xxxxxxx the years xxxxxxx good returns xxxxxxx its xxxxxxx xxxxxxx are also xxxxxxx to be xxxxxxx businesses in xxxxxxx As an xxxxxxx we can xxxxxxx that in xxxxxxx xxxxxxx decade xxxxxxx the companies xxxxxxx an Return xxxxxxx Earnings xxxxxxx xxxxxxx say 30 xxxxxxx All the xxxxxxx enjoy drinking xxxxxxx soda from xxxxxxx the companies, xxxxxxx if they xxxxxxx xxxxxxx choose xxxxxxx one stock xxxxxxx which they xxxxxxx invest, xxxxxxx xxxxxxx one would xxxxxxx be? Let's xxxxxxx out.

    Valuation

    The first xxxxxxx that any xxxxxxx can draw xxxxxxx that Coke's xxxxxxx xxxxxxx is xxxxxxx higher than xxxxxxx and while xxxxxxx has xxxxxxx xxxxxxx to Growth) xxxxxxx of 2.57, xxxxxxx  has 3.81 xxxxxxx is 48% xxxxxxx than that xxxxxxx coke. For xxxxxxx xxxxxxx PEG xxxxxxx too high xxxxxxx because the xxxxxxx expect xxxxxxx xxxxxxx earnings growth xxxxxxx as compared xxxxxxx Coke. Now xxxxxxx investors expect xxxxxxx (Earnings Per xxxxxxx to grow xxxxxxx xxxxxxx for xxxxxxx and at xxxxxxx rate of xxxxxxx percent xxxxxxx xxxxxxx over the xxxxxxx five years.

    The xxxxxxx is presenting xxxxxxx cola with xxxxxxx trading multiples xxxxxxx because it xxxxxxx xxxxxxx to xxxxxxx its earnings xxxxxxx a higher xxxxxxx For xxxxxxx xxxxxxx every $1 xxxxxxx Coke generates xxxxxxx way of xxxxxxx the market xxxxxxx it with xxxxxxx enterprise value, xxxxxxx xxxxxxx is xxxxxxx by only xxxxxxx enterprise value xxxxxxx every xxxxxxx xxxxxxx revenue that xxxxxxx generates. From xxxxxxx point of xxxxxxx of both xxxxxxx companies, coca xxxxxxx looks more xxxxxxx xxxxxxx of xxxxxxx better Earnings xxxxxxx Share growth xxxxxxx Strength

    Considering xxxxxxx xxxxxxx strength of xxxxxxx two companies, xxxxxxx the financial xxxxxxx 2011, Coca xxxxxxx was holding xxxxxxx as cash xxxxxxx xxxxxxx equivalents xxxxxxx $13.6B in xxxxxxx debt, providing xxxxxxx company xxxxxxx xxxxxxx of $1.03 xxxxxxx every $1 xxxxxxx long-term debt xxxxxxx it held. xxxxxxx working capital xxxxxxx the company xxxxxxx xxxxxxx was xxxxxxx whereas its xxxxxxx capital per xxxxxxx was xxxxxxx xxxxxxx the stock xxxxxxx the company xxxxxxx trade at xxxxxxx 142 times xxxxxxx working capital xxxxxxx share.

    On the xxxxxxx xxxxxxx Pepsi xxxxxxx a negative xxxxxxx capital of xxxxxxx in xxxxxxx xxxxxxx year 2011, xxxxxxx helps us xxxxxxx conclude that xxxxxxx did not xxxxxxx sufficient funds xxxxxxx meet its xxxxxxx xxxxxxx and xxxxxxx the working xxxxxxx per share xxxxxxx the xxxxxxx xxxxxxx negative $0.46, xxxxxxx as calculated xxxxxxx Coke had xxxxxxx positive $0.27 xxxxxxx working capital xxxxxxx share.

    If a xxxxxxx xxxxxxx current xxxxxxx which exceeds xxxxxxx current assets, xxxxxxx the xxxxxxx xxxxxxx runs into xxxxxxx and has xxxxxxx in paying xxxxxxx to its xxxxxxx Here we xxxxxxx back to xxxxxxx xxxxxxx year xxxxxxx far back xxxxxxx 2008 for xxxxxxx and xxxxxxx xxxxxxx 2011 was xxxxxxx only year xxxxxxx it had xxxxxxx capital which xxxxxxx negative during xxxxxxx four year xxxxxxx xxxxxxx could xxxxxxx a red xxxxxxx for Pepsi. xxxxxxx will xxxxxxx xxxxxxx to wait xxxxxxx the financial xxxxxxx 2012 results xxxxxxx make any xxxxxxx forecasts.

    Coca Cola xxxxxxx its last xxxxxxx xxxxxxx had xxxxxxx quick ratio xxxxxxx 0.92 which xxxxxxx indicates xxxxxxx xxxxxxx company is xxxxxxx of cash xxxxxxx pay off xxxxxxx current but xxxxxxx the company xxxxxxx $0.92 of xxxxxxx xxxxxxx the xxxxxxx can convert xxxxxxx into cash xxxxxxx instantly xxxxxxx xxxxxxx $1 it xxxxxxx in current xxxxxxx On the xxxxxxx hand the xxxxxxx ratio of xxxxxxx was 0.75. xxxxxxx xxxxxxx to xxxxxxx noted that xxxxxxx the stock xxxxxxx take xxxxxxx xxxxxxx sale and xxxxxxx converted into xxxxxxx therefore, it xxxxxxx excluded from xxxxxxx quick ratio xxxxxxx regard to xxxxxxx xxxxxxx Pepsi xxxxxxx quite efficient xxxxxxx it clears xxxxxxx inventory xxxxxxx xxxxxxx days, While xxxxxxx Cola takes xxxxxxx days for xxxxxxx same. While xxxxxxx the companies xxxxxxx their inventory xxxxxxx xxxxxxx or xxxxxxx days, but xxxxxxx the same xxxxxxx they xxxxxxx xxxxxxx receivables every xxxxxxx days, which xxxxxxx that they xxxxxxx still improve xxxxxxx cash collection xxxxxxx a faster xxxxxxx xxxxxxx financial xxxxxxx shown above xxxxxxx can clearly xxxxxxx that xxxxxxx xxxxxxx to equity xxxxxxx of Pepsi xxxxxxx 37 percent xxxxxxx than Coke, xxxxxxx versus .99, xxxxxxx it clearly xxxxxxx xxxxxxx investors xxxxxxx taking a xxxxxxx risk when xxxxxxx in xxxxxxx xxxxxxx these stocks xxxxxxx to be xxxxxxx exclusively on xxxxxxx debt to xxxxxxx ratio, it xxxxxxx not be xxxxxxx xxxxxxx because xxxxxxx earn high xxxxxxx on equity. xxxxxxx in xxxxxxx xxxxxxx Coke's debt xxxxxxx equity ratio xxxxxxx less risky. xxxxxxx after a xxxxxxx stock price xxxxxxx financial analysis xxxxxxx xxxxxxx the xxxxxxx Coca Cola xxxxxxx gains rank xxxxxxx Pepsi.

    Conclusion

    Overall xxxxxxx xxxxxxx companies are xxxxxxx good financially xxxxxxx the decreasing xxxxxxx for revenue xxxxxxx mainly due xxxxxxx the current xxxxxxx xxxxxxx crises xxxxxxx has affected xxxxxxx profit margins, xxxxxxx a xxxxxxx xxxxxxx observed in xxxxxxx the ratios xxxxxxx indicates that xxxxxxx companies according xxxxxxx each ones  xxxxxxx is doing xxxxxxx xxxxxxx the xxxxxxx economic situation.

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    http://businesscasestudies.co.uk/coca-cola-great-britain/who-dares-wins-success-through-intelligent-risk/key-aspects-of-coca-colas-business.html#axzz2EoRngLgP

     

    http://inventors.about.com/library/inventors/blpepsi.htm

    http://www.businessinsider.com/how-pepsi-lost-cola-war-against-coke-2012-5?op=1

    web.mit.edu/wysockip/www/535/MIT2001/Cocacola.pdf

    http://seekingalpha.com/article/822511-a-look-at-coca-cola-after-its-recent-stock-split

    http://community.nasdaq.com/news/2012-12/coca-cola-hsn-to-collaborate-analyst-blog.aspx?storyid=197559

    http://www.investmentu.com/2012/February/are-the-coke-vs-pepsi-cola-wars-over.html

    Investing xxxxxxx Coca-Cola or xxxxxxx for xxxxxxx xxxxxxx – MSN xxxxxxx (n.d.). Retrieved xxxxxxx http://articles.moneycentral.msn.com/learn-how-to-invest/coke-or-pepsi-which-stock-to-buy.aspx

    Property on xxxxxxx move… (2011)|. xxxxxxx Retrieved from xxxxxxx wordpress.com/2009/05/29/property-on-the-move/

    The week xxxxxxx xxxxxxx Coke xxxxxxx Pepsi (2009) xxxxxxx Blogging Stocks. xxxxxxx Retrieved xxxxxxx xxxxxxx pepsi/?icid=sphere_wsj_teaser

    Report Cola xxxxxxx Continue (2009): xxxxxxx and Pepsi. xxxxxxx Retrieved from xxxxxxx /17929837/Report-Cola-Wars-Continue-Coke-and-Pepsi

     

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