The problem is that these changes will occur when the company is facing greater challenges. This will hurt their competitive position, profit margins, stock performance and brand image. The above information will impact an investor's decision, by making them more cautious about purchasing the company over the long-term. ("The Coca Cola Company," 2012) ("Pepsi Co," 2012)
As far as Pepsi Co is concerned, the management has taken a continuing focus on expanding into new areas. This has resulted in the company owning different food, beverage and snack manufacturers. In these situations, the firm is concentrating on the impact that key acquisitions will have on Pepsi and its ability to enter new markets. ("The Coca Cola Company," 2012) ("Pepsi Co," 2012)
This strategy has proven to be highly successful. As the company is able to reach out to consumers through the large variety of merchandise they are selling. This means that even if a customer selects a competitor's product. The odds are high that they will also choose another brand that Pepsi owns (only in a different area such as: food, snacks or dairy). This helps the firm to increase its profit margins and continue to promote themselves. These facts will assist investors in making an informed choice about future levels of growth and the firm's competitive position. ("The Coca Cola Company," 2012) ("Pepsi Co," 2012)
Based on your review of the financial data for each company, indicate the accuracy and reliability of the data for making investment decision. Provide support for your conclusion.
All sources of information are accurate and reliable. This is because it was collected from data that is filed in accordance with the Securities and Exchange Act of 1934. This requires that all firms must submit information which has been certified through an independent auditor. (Dravis, 2007)
Moreover, the Sarbanes-Oxley Act of 2002 forces all CEOs / CFOs to certify that the data and statements are factually accurate. These laws are evidence of how the information on both firms is complete. Otherwise, anyone who knowingly misleads the public can be charged criminally under this statute. (Dravis, 2007)
Recommend which company you consider as the better investment for your client and how you will present your recommendation. Support your recommendation with data from your analysis.
The company that is the better investment is Pepsi Co. This is because the firm is diversified in a number of industries and markets. These factors are allowing the corporation to reach out to a larger demographic...
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