A Profitability Analysis of Coca-Cola and PepsiCo

Timothy Cummings

Co-Presenters: Individual Presentation

College: College of Business and Public Management

Major: BS.MANAGEMNT-GENBUS

Faculty Research Mentor: Yu, Huaibing  

Abstract:

The aim of this study is to evaluate and compare the gross profitability margin of Coca-Cola and PepsiCo. Profitability in this study is going to be measured in many different ways, the most basic being the difference between each companies revenue and expenses. Coca-Cola was founded in 1886 and went public in 1919. PepsiCo was founded in 1893 as Brad's Drink and went public in 1965 upon merging Pepsi-Cola with Frito-Lay. Understanding this, both of these brands are U.S. based and serve the beverage industries, with PepsiCo also serving the snack industry. They also both offer brands to the world market that are well recognized and known for a consistent quality. The studies analysis will take place over only the last 5 years to best reflect the current market and help mitigate market volatility as a variable. In order to weigh profitability equally, the ratio given in gross profit margin, operating profit margin, net profit margin, return on assets, and return on equity will be given.