Motley Fool Money Starbucks > Pepsi > Coke
Oct 9, 2024
In this engaging discussion, Jason Hall, an investment analyst at The Motley Fool, navigates the shifting sands of consumer goods, exploring PepsiCo's recent struggles and comparing its performance to Coke and Starbucks. Adam Comora and Jonathan Maurer, co-CEOs of OPAL Fuels, highlight the surge in renewable natural gas for trucking, showcasing how organic waste can power heavy-duty vehicles. They delve into the energy shift within the transportation sector, emphasizing sustainability's role in the industry's future.
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PepsiCo vs Coca-Cola Stock Performance
- PepsiCo's stock underperformed the S&P significantly, rising less than 1% year-to-date, while Coca-Cola more closely tracked the index, though also underperforming.
- This difference is attributed to valuation, expectations, and PepsiCo's struggles with its foods business.
PepsiCo's Quaker Foods Segment Struggles
- PepsiCo's Quaker Foods segment experienced a significant decline in revenue (13%) and core operating profit (28%) due to product recalls.
- While recalls are inevitable at large scales, they can indicate larger problems with quality control if frequent.
PepsiCo as a Portfolio Addition
- PepsiCo is an aggressive repurchaser of its shares, offers a good dividend, and has a lower PE ratio than Coca-Cola.
- However, for better long-term returns in the beverage sector, Starbucks might be a more compelling choice.