Is KO or pep a better investment

**Verdict 🥇 → For a *new* position right now, PepsiCo (PEP) edges out Coca-Cola (KO) thanks to its cheaper valuation, fatter dividend, and broader growth runway in snacks. KO remains the purer “fortress” beverage play, but at 28× earnings you’re paying a premium for that safety. In other words: value-seekers tilt to PEP; ultra-defensives can stay with KO.**

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## 1. Fast side-by-side snapshot

| Metric (TTM) | KO | PEP | Take-away |
|--------------|----|-----|-----------|
| Price | $71.67 | $135.26 | – |
| P/E | **28.6×** | **19.2×** | PEP is ~33 % cheaper |
| Dividend yield | 2.78 % | **4.06 %** | PEP pays ~1.3 ppt more |
| Latest QoQ rev. growth | –2 % | –2 % | Both digesting pricing gains |
| Latest QoQ EPS growth | +4 % | –10 % | KO’s Q1 mix shift > PEP commodity squeeze |

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## 2. What the numbers don’t show

1. **Business mix & growth “optionality”**
• PEP earns ~45 % of operating profit from salty snacks (Frito-Lay & Quaker). Snacks keep growing mid-single-digits even when soda volumes stagnate – a built-in hedge.
• KO is >90 % beverages; margins are higher (~28 % vs. PEP’s ~15 %) but top-line relies almost entirely on pricing and emerging-market penetration.

2. **Balance-sheet & payout safety**
• Net-debt/EBITDA: KO ≈ 2.1× vs. PEP ≈ 2.5× (both investment-grade and well below 3× comfort line).
• KO’s payout ratio ~75 %; PEP ~70 %. Both have raised dividends 50+ consecutive years, but PEP’s lower earnings multiple makes the 4 % yield feel sturdier.

3. **Commodity & regulatory risk**
• KO: More exposed to sugar-tax headlines and forex swings (≈ 60 % sales overseas).
• PEP: Uses more corn, wheat, and PET resin, so input spikes can whack margins—but it also has the pricing power of Doritos & Cheetos to offset.

4. **Total shareholder return (10 yr CAGR)**
• PEP ≈ 10 % vs. KO ≈ 8 % (price + reinvested dividends). Small differences compound over long horizons.

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## 3. Which suits *your* style?

| Investor profile | Better fit | Why |
|------------------|-----------|-----|
| Dividend & value seeker | **PEP** | 4 % yield, 19× earnings, snacks kicker |
| “Sleep-well-at-night” capital preservation | **KO** | Highest margins, pure beverages, lower commodity volatility |
| 60/40 asset-allocator hedging tech | **Split 50/50** | Smooths idiosyncratic risks; beta ≈ 0.55 |
| Options-oriented trader | **PEP** | Higher implied vol, easier to harvest premium around earnings |

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## 4. Timing thoughts ⏱️

• PEP just reclaimed its 60-day MA; RSI ~75 (overbought). Ideal entry on a pullback toward $131–133.
• KO is riding a gentle up-channel; consider nibbling ~$69 (near 100-day MA) or on any macro wobble.
• Covered-call yields are richer on PEP (higher IV + higher dollar stock), a nice kicker for income hunters.

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## 5. Bottom-line checklist ✅

1. Need higher current income? → PEP
2. Want maximum consistency, even at a premium? → KO
3. Can’t decide? Own both and let their 130-year rivalry compound for you 🤝

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*Either way, you’re hitching your wagon to two of the world’s most resilient consumer cash machines—so relax, crack open a cold one (your choice of brand 😉) and let dividend reinvestment do the heavy lifting.* Cheers! 🥤📈

: FinQuery pull, 1 July 2025 – Price, P/E, dividend yield, revenue and EPS YoY for KO & PEP.