Coke or Pepsi: Which stock is a better investment?

The debate lives on. As a kid, I can remember parents getting in heated debates and strong-willed arguments about the benefits and shortcomings of both Coke and Pepsi as well as Ford and Chevy. The grocery store I worked at as a kid; we would sell 100/1 Pepsi over Coke. Yet in other parts of the country, it was just the opposite. Apparently, the sodas or pops are demographically territorial as well.

What’s interesting is that when it comes to stock prices and valuations, the debate heats up once again. Who is going to be the ultimate winner in terms of stock price value and appreciation? Let’s take a look at the fundamentals and charts to get a clearer picture.

In April of 2022, The Coca-Cola Company (NYSE: KO) hit a high of $67.20 with a current P/E 27.52 and an EPS of $2.27. Compared to PepsiCo (NASDAQ: PEP) which hit a high as early as May of 2023 of $196.88, with a P/E of 33.27 and an EPS of $5.72. So what does all of that mean to you and I? All of those numbers are great and can be useful, but what does the Market think about these two companies?

Pepsi’s shares continue to rise and we can easily see the stock increasing in value by another $6 a share prior to pausing. It’s been consistently trading inside of this channel and that channel is getting narrower as time goes on. It’s possible we could see a breakout and close above the $200 price target however we think that the sellers will come into play at or around those levels.

With Coke, instead of this steady rising channel that we are seeing with Pepsi, it has been a sideways moving channel, slightly higher lows, and we are seeing strong resistance at or around the $65 price target. All indications are that once Coke’s stock builds up enough energy to the upside and breaks through and closes above $65 we will see it surpass the previous $67.20 levels onto new highs.

Even a surge in Pepsi could pull Coke stock higher and in unison with Pepsi. We believe that both Coke and Pepsi can and will reach new highs in this environment.

If you are wondering who won the debate as a kid, Coke or Pepsi, it depended on which drink your parents preferred. My parents were Pepsi drinkers. How about yours? I guess the debate continues and always will, with these two companies. It depends on who you ask. In our opinion, we will see both companies making new highs before the end of the year.

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