and Coca-Cola wasn't one of them! That's right - they think these 10 stocks are even better buys. They just revealed what they believe are the ten best stocks for investors to buy right now. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.* When our analyst team has a stock tip, it can pay to listen. But most growth-focused investors will favor Coca-Cola stock today despite its relatively higher price. This diversity was valuable in the earlier phases of the pandemic when spending trends contracted sharply, and so it could provide similar stability in the next recession. PepsiCo carries potentially less risk due to its lower valuation and its more diverse portfolio of consumer essentials. For that higher price, an investor gets exposure to Coke's much more profitable business, which is on pace to set more sales and earnings records in 2023. Its price-to-sales (P/S) ratio is 3 as of early May, or roughly half of Coke's valuation. PepsiCo's stock is valued at a large discount to Coca-Cola's. Both companies favor dividend payments over stock buybacks as their preferred channel for direct shareholder returns. But Coke's dividend is growing more slowly at 5% this year compared to Pepsi's 10% hike for 2023. PepsiCo shares are yielding 2.5% today compared to roughly 2.8% for Coca-Cola. Income investors won't find a lot to separate the two stocks at a glance. Combined with the company's improving growth profile, these shifts point to potentially strengthening profitability in 2024 and beyond. On a non-GAAP basis, both gross and operating profit margins edged higher in Q1 thanks to help from several quarters of price hikes along with aggressive cost cutting. Pepsi's margins do appear set to begin rebounding, though. The Smartwater franchise grew volume by 8% this past quarter, for example, with help from popular innovations in the hydration niche. These factors allow Coke to profit from established brands while giving it a platform to build new franchises. Since it has a better market share coverage, Microsoft Outlook holds the 1st spot in 6sense’s Market Share Ranking Index for the Email Client category, while Polymail holds the 32nd spot. The gap here reflects several valuable competitive assets of Coke's, including its massive global distribution network, its relative strength around on-the-go drink sales, and its scale. In the Email Client market, Microsoft Outlook has a 94.00 market share in comparison to Polymail’s 0.00. Profit marginĬoke easily wins the profit matchup as its operating profit margin is above 30% of sales compared to PepsiCo's 15%. Coke affirmed its guidance for a 7% to 8% uptick this year. Give the edge to Pepsi here, which raised its 2023 outlook to call for organic growth of about 8%, on top of last year's 14% spike. That result edged past the 10% increase that Pepsi reported a few days later in its beverage segment.īut strong growth in the snack and breakfast food segments allowed PepsiCo's overall sales to rise 14%. Coca-Cola said on April 24 that organic sales were up a solid 12% through late March compared to a 15% spike in the prior quarter. There's mostly positive news regarding growth for both companies.
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