Friday Stock Comparison: Coca-Cola (KO) vs PepsiCo (PEP)
By Dennis Riosa — Economist | Entrepreneur | Financial Educator
This week, we're pouring into the U.S. beverage sector to compare two industry titans: Coca-Cola and PepsiCo. Both companies are global leaders in the non-alcoholic beverage market, but they differ in product diversification, financial health, and growth strategies. Let's dig in.
Over the past few years, the beverage industry has experienced significant shifts due to changing consumer preferences, health trends, and economic pressures. Key trends include:
Health-Conscious Consumption: Consumers are increasingly seeking healthier beverage options, prompting companies to innovate and diversify their product lines.
Global Expansion: Emerging markets present growth opportunities, with companies investing in expanding their international footprints.
Sustainability Initiatives: Environmental concerns are driving companies to adopt sustainable practices in packaging and operations.
Economic Uncertainty: Macroeconomic factors, including inflation and potential recessions, influence consumer spending and company strategies.
So, where do Coca-Cola and PepsiCo stand amidst these developments?
Coca-Cola Company (NYSE: KO)
Founded in 1892, Coca-Cola has become synonymous with soft drinks worldwide. The company boasts a vast portfolio of beverages, including sodas, juices, and bottled water.
Recent Stock Performance: As of May 8, 2025, Coca-Cola's stock closed at $71.17, reflecting a year-to-date increase of approximately 17%. The stock reached a 52-week high of $73.90 on April 22, 2025.
3 Reasons to Invest in Coca-Cola:
Strong Financial Performance: In Q4 2024, Coca-Cola reported a 6% year-over-year revenue growth to $11.5 billion and a 12% increase in EPS to $0.51.
Robust Dividend History: The company has increased its dividend for 63 consecutive years, with a current yield of approximately 2.8%.
Global Market Presence: Coca-Cola's extensive distribution network and brand recognition position it well for continued growth, especially in emerging markets.
PepsiCo Inc. (NASDAQ: PEP)
Established in 1898, PepsiCo has evolved into a diversified food and beverage conglomerate, with products ranging from soft drinks to snacks like Lay's and Doritos.
Recent Stock Performance: As of May 8, 2025, PepsiCo's stock closed at $131.43, marking a decline of approximately 12% year-to-date. The stock is trading near its 52-week low of $130.16.
3 Reasons to Invest in PepsiCo:
Diversified Product Portfolio: Beyond beverages, PepsiCo's strong presence in the snack industry provides multiple revenue streams, offering resilience against market volatility.
Consistent Dividend Growth: PepsiCo has paid consecutive quarterly dividends since 1965, marking 53 years of annual dividend increases.
International Revenue Growth: In Q1 2025, PepsiCo reported a 5% increase in international revenue, offsetting a 2% decline in U.S. food sales.
So… which beverage stock would YOU invest in?
Would you choose Coca-Cola, with its strong financials and global brand recognition?
Or opt for PepsiCo, known for its diversified product portfolio and consistent dividend growth?
Let me know in the comments. I want to hear how you think through this choice.
SPOILER ALERT:
Here’s my personal take on the two stocks:
While both Coca-Cola and PepsiCo are stalwarts in the beverage industry, Coca-Cola currently presents a more compelling investment opportunity. The company's strong financial performance, evidenced by a 6% revenue growth and 12% EPS increase in Q4 2024, showcases its operational efficiency. Additionally, Coca-Cola's consistent dividend growth over 63 years and its extensive global market presence provide a solid foundation for long-term investors.
In contrast, PepsiCo's recent stock performance has been underwhelming, with a 12% decline year-to-date. While its diversified product portfolio offers resilience, the company's U.S. food sales have declined by 2% in Q1 2025, raising concerns about domestic market saturation. Although PepsiCo's international revenue growth is promising, the overall financial indicators suggest that Coca-Cola currently holds a stronger position in the market.
Therefore, based on the current financial data and market trends, Coca-Cola (KO) appears to be the better stock to own right now. But that’s just my opinion; this is not financial advice and this content is for educational purposes only.
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HERE ARE THE 1-YEAR DAILY CHARTS:
COCA-COLA (NYSE: KO)
PEPSICO (NASDAQ: PEP)
If you were only to invest in one of the two, which one would you pick? Let me know your choice in the comments and tell me why you would choose one over the other. Remember to subscribe to get free weekly access to stock comparisons and much, much more.
And if you want more, I suggest you check out last week’s Friday Stock Comparison between Verizon and T-Mobile, just a click away.
Friday Stock Comparison: Verizon (VZ) vs. T-Mobile (TMUS)
This week, we're dialing into the U.S. telecom sector to compare two industry giants: Verizon and T-Mobile. Both companies are key players in wireless communication, but they differ in strategy, financial health, and growth prospects. Let's dig in.
With love,
Dennis Riosa
Make | Things | Happen
I think I would like to read the sustainability reports of both companies before making a decision. Environmental issues are more and more important nowadays, and I would rather support a company that matches those values. However, I am aware that this kind of thinking might make me lose money in stocks as well, especially in these types of companies.