Company and Industry Analysis of PepsiCo. Inc.

Company and Industry Analysis

FIN 132 – Company Analysis Assignment #4

Company and Industry Analysis             Company:  Pepsi(PEP.)

You are to provide a brief analysis of your company and the industry in which it operates.  The specific requirements are as follows:

• Company Analysis.  Briefly analyze your company from the standpoint of major products/services, lines of business, geographic presence, growth and profitability:

1.     What does your company do, i.e. what are your company’s major products or services? 

2.      What is the dollar and percentage sales and/or profit breakdown of your company by reported business segments? 

3.      If your company has significant international operations, what is the dollar and percentage breakdown of sales and/or profits between US and non-US operations? 

4.      Have company sales and profits been growing, shrinking or stagnant over the past two years?  What are the main reasons for these trends in your own words

Note: Tables would be a very appropriate way of presenting segment/regional breakdown info, and may be taken from original sources (with appropriate citation). 

• Industry Analysis.   If your company operates in more than one major industry, then identify and describe the one industry that contributes the greatest share of company revenue and/or earnings (document this) and focus on it. 

1.      Briefly describe the industry in terms of product, market, etc.  What is the industry’s SIC/NAICS classification?

2.      Is the industry defensive or cyclical as we discussed in class, and why?

3.      Is this a growth industry or a mature industry? 

4.      Is the industry’s market fragmented (i.e. all companies have relatively small market shares) or concentrated (i.e. one or more companies have large market shares)? 

5.      What are one or two major current trends/developments affecting the industry?  These can include demand trends, trends in input costs, regulatory developments, or competitive forces.  I am looking here for industry-specific trends.  Also, don’t confuse seasonal patterns (for example, the tendency of retailers to earn most of their profits during the holiday season) or cyclical (economic) patterns with industry trends.  Why are these trends important?  Are they short-term or long-term trends? 

Document all answers with relevant data/facts!

• Important:  You are expected to use at least two resources discussed by Prof. Simon in her guest lecture on library resources, in addition to the company’s 10-K.  Prof. Simon is available via email to help with accessing these resources if you have any difficulties.  Cite all resources used.  (I am not concerned with citation format, for example, you can simply say something like “Source:  S&P Capital IQ Computer Industry Report, 9/2014”).

Dr. Simon is an expert on business-related library resources which will be essential to your completion of assignment #4 (not yet posted). 

The link below is for your use in conjunction with Dr. Simon's presentation, and in doing your assignments.  (If the link doesn't work, just copy and paste into your browser.) 

 https://libguides(dot)hofstra(dot)edu/finance132_principlesofinvestments_fall2019_proffrank

A few guidelines/tips:

• Format your assignment in line with the instructions:  Place your answers under two sections, “Company Analysis” and “Industry Analysis,” and number your responses to correspond with the numbered questions under each section.


• Answer all questions, and completely answer the question being asked!   Students frequently lose points for failing to do this.


• Your discussion must directly address the above points and questions, therefore a “cut-and-paste” will not satisfy the requirement.  You will lose points if I spot cut-and-paste (and I can almost always spot it).


• Support your analysis with relevant data/facts.  For example, it is insufficient to simply say “the industry is concentrated.”  Follow up such a statement by identifying the largest companies in the market and their respective shares.


• Since the question always comes up, I would say that 2-4 pages, double-spaced, should suffice to do this assignment (excluding exhibits/tables).  This means that you don’t have to write a lot, but you do have to sift through and synthesize the available information so as to include that which is essential and relevant!  Two pages of concise, complete, and well-thought-out analysis will get more credit than four pages of random, cut-and-paste facts and unsubstantiated statements.