1 / 22

Brianne Powers February 21, 2003

Brianne Powers February 21, 2003. Presentation Overview. Financial Snapshot of PepsiCo SMIP’s Current Position Company Overview Recent News Stock Performance Financial Statements Ratio Comparison Valuation CAPM RiskGrades Analysis Analyst Opinions Conclusions. Financial Snapshot.

marinel
Download Presentation

Brianne Powers February 21, 2003

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Brianne Powers February 21, 2003

  2. Presentation Overview • Financial Snapshot of PepsiCo • SMIP’s Current Position • Company Overview • Recent News • Stock Performance • Financial Statements • Ratio Comparison • Valuation • CAPM • RiskGrades Analysis • Analyst Opinions • Conclusions

  3. Financial Snapshot Ticker: PEP (NYSE) Sector: Consumer Staples/Non-Cyclical Industry: Beverages (Non-Alcoholic) Market Cap.: $68.8 Billion 52 Week High: $53.50 52 Week Low: $34.00 Last Traded: $40.20 (as of 2/18/03)

  4. SMIP’s Current Position 35 Shares of PEP Purchased on December 2, 2002 Cost Basis: $1,470 Current Market Value: $1,407

  5. Company Overview PepsiCo, Inc. is a leading manufacturer, marketer, and seller of snack foods, soft drinks and concentrates, and branded juices. During the summer of 2001, the Company acquired the Quaker Oats Company in an effort to grow and mature into the world’s premier convenient food and beverage provider. Operates two business segments: Worldwide Snacks & Worldwide Beverages

  6. Recent News PepsiCo will no longer provide quarterly, annual guidance PepsiCo net rises 21% on price increases Riese Restaurants switches to Pepsi Scuffle with rapper Ludacris over contract War Over Obesity

  7. Stock Performance (3-year)

  8. Stock Performance (1-year)

  9. Competitors

  10. PEP vs. Competitors

  11. Financial Statements

  12. Ratio Comparison

  13. EVA and MVA

  14. Basic Stock Valuation

  15. Free Cash Flow Model

  16. Intrinsic Value Constant Growth Model $33.20 Variable Growth Model $25.49 Dividend and Earnings Model $38.82 Price/Earnings Model $37.55 Free Cash Flows $56.44 Valuepro.net $33.66 Intrinsic Value $37.53

  17. Capital Asset Pricing Model K = Rf + (Rm * Beta) Rf = 4.75 Rm = 5.5 Beta = .73 SO, K = 8.77% This calculation shows that an 8.77% Return on Investment should be expected from an investment in PepsiCo, Inc.

  18. RiskGrades Analysis Current RiskGrade: 147 Less Risky than 71% of the market

  19. Analyst Opinions

  20. Conclusions Bad Press-Potential for Future Lawsuits PEP does not fit with SMIP’s new Investment Theory Less than Par Stock Performance (vs. Competitors) Trading at Intrinsic Value

  21. Recommendation SELL 35 shares of PepsiCo, Inc.

  22. Questions/Comments?

More Related