A Paper on Pepsico

PepsiCo is a good investment because it is a well managed federation with strong sales in a large securities industry that is both diverse and world wide. PepsiCo continues to innovate and penetrate unexampled markets (for example the flavored water market), and is non losing market share to competitors. PepsiCo is a safe investment because there go away always be a demand for Pepsis products, even during recessions, and therefore the stock will be resistant to cyclical changes in the market and economy. The dividend does not provide huge amounts of income, but it is a nice cushion. PepsiCos income education shows that 2006 Net Income was significantly higher than both 2004 and 2005 (35% and 38%). maven of the key factors that account for this growth is between 2004 and 2005 cost of sales (or cost of goods sold) however change magnitude by 12% and by only 11% between 2005 and 2006. Selling, General & Administrative Expense developmentd only 4% between 2005 and 2006 while revenues increased by 8% meaning that revenues increased twice as dissolute as SG&A between 2005 and 2006. This analysis of the income statement illustrates Pepsis qualification to increase revenues while keeping costs under control. Pepsi is so becoming to a greater extent efficient while growing. PepsiCos Balance tag shows that liabilities have decreased 17% between 2005 and 2006.

The Balance flat solid also shows that assets only declined 6%. The larger decrease in liabilities than assets means there has been an increase in stockholders equity. The increase comes from an increase of 18% in retained earnings. The increase in retained earnings came principally from greater net income, not from a decrease in dividends. There was an increase of 13% in cash dividends paid in 2006 over 2005. This illustrates Pepsi is reinvesting its earnings, and generating more revenue with less debt and fewer assets. PepsiCos international growth has been twice as great as North American growth. Pepsis strain on the international market, especially in second and... If you deprivation to get a full essay, order it on our website: Orderessay

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