Financial Statement Analysis Using Pepsico and Coca-Cola

Abstract

The authors conduct a financial statement analysis of two corporations: Pepsico and Coca-Cola. We use financial statement data derived from the SEC Form 10K documents for each company and Yahoo Finance was used for earnings per share data. We conduct the analysis for the years from 2021 to 2025. Using detailed financial statements, this paper will highlight the strengths and weaknesses of each company. Financial ratio analysis will be used as the basis for these comparisons.

Pepsi has higher Revenue but Coca Cola’s Net Income is larger. Pepscoi has higher COGS which reflects the larger size of Pepsi and has higher Gross Profit, Depreciation, and SG&A Expenses. Coke has higher liquidity and lower financial leverage. Both companies have similar turnover ratios except for Inventory Turnover and Total Asset Turnover which are higher for Pepsi. Coke had higher Net Profit Margin but Pepsi has higher return on equity. Both companies have similar Price Earnings ratios but Pepsi has a slightly higher Market to Book Value ratio. Dividend Payout Ratio for Coke is higher. Funds from operations for both companies were similar. Overall capital expenditure for Pepsi was three times capital expenditures for Coke. Coke pays a higher total dividend than Pepsi. Average net cash outflow for Pepsi was roughly equal to that for Coke.