PEPSI CORPORATION 1) Identify an industry to focus on (It is suggested that you

ID: 2739665 • Letter: P

Question

PEPSI CORPORATION

1) Identify an industry to focus on (It is suggested that you use an industry that is expanding rather than consolidating, but the choice is yours to make). Explain why you chose this industry and its environment.

2) Identify the top companies in the industry using your own selection of criteria (market capitalization, ROE, or any other financial criteria you wish to develop.) Your decisions on which set of criteria to use, are to be considered part of the project and your rationalization must be explained.

3) Compile a ratio analysis of the top competitors in the industry using the company’s financial statements. You should limit the number of companies you are researching to between 3-5.

The ratio analysis should include:

a) a 5 year trend analysis of each company selected and compared to the industry averages and

b) a competitive analysis of the selected major competitors using four main standards: profitability, liquidity, debt and return on equity.

4) Establish growth projections for the top competitors using established methods, including pro forma income statements and balance sheets for the coming year.

5) Analyze the following elements of the major competitors:

[It is expected that you will discuss why you selected the measures used, interpret the data and explain what this information suggests about the company’s financial situation and future financing needs.]

a) Each company’s capital structure

b) Cost of capital, capital structure, CAPM, cash flow, value of common stock and MVA.

6) You are expected to look at a potential takeover target for the company (within the industry or closely related to the industry), evaluate the takeover and the price to be paid for the target using established valuation criteria. It is expected that you will discuss the selection of the criteria used and to comment on its relative value in the analysis.

Explanation / Answer

Step-1:

Intellectual property is used everywhere in economy. Intellectual property is generate economic growth, which industries produce or use significant amount of intellectual property. The report begins for investigation by developing several industry levels. In future more users will sets the trade mark on US patents and trade office.

Step-2:

Top companies in the world:

In this top companies used the name of place of the business. These companies started to create a good will in market. Do finally the product of company created the brand in marker. The brand will lead the companies to top in the industry.

Step-3:

Ratios

Toyota company

Volk wagon

Samsung

Gross margin ration

20.4

Operating margin

14.4

Payout ratio

28.7

20.2

5.2

Step-4:

Top companies are establishing new methods for growth in the industry. The fastest way to get the goods name, it is used the methods that involve forming host beneficiary, relationship with established business that cater to target audience. New methods were satisfying the customer desires, and provide the in time.