PIU family!

I want to help you with analyzing and researching your dividend stocks (giving yourself a raise). And I've decided to start a new segment where I analyze competitor companies from both a technical stand point and a fundamental qualitative stand point.

Let's start with the classic debate of Coca-Cola (KO) vs Pepsi (PEP).

Straight to the point, PEP is the clear winner imo.

First, the numbers/technical analysis (see pic below).

While Coca-Cola has a higher dividend yield and 1 yr net income growth rate, it loses to Pepsi when it comes to the more important ratios.

Quick reminder:

The payout ratio tells us how much the company has to pay its shareholders in dividends. The higher this number is (or the closer this number is to 100%) it means that a company is spending most of its money paying out dividends and will have less money to grow/expand the company. In short you want a lower payout ratio.
DCR = Dividend Coverage Ratio | This number tells us how many times they can pay their current dividend with its net income (over a given year). As a general rule of thumb a DCR < 1.5 should be a red flag and cause for concern.
5yr Growth Rate | How much has the dividend grown over the last 5 years.
1yr NI Growth = Net Income Growth | This percentage shows the growth in profit over the previous reported years (2021 vs 2020)
PE Ratio = Price-to-Earnings Ratio | In short this tells us if the stock is under/over valued. It's important to remember that the PE ratio should be compared to it's competitors PE ratio or the average PE for the industry the company operates in. Remember that a higher PE does not necessarily mean a company is over valued. It could be an indication that investors expect the stock price to rise in the future.

Passive Income for the win!

Curtis G.

1 comment

Contract Money! [Less Than 3 Hours]

MARKET MONEY: Understanding Stocks and the Basics of Investing

LET'S DO THIS - It's almost time for the resume building workshop!

[REMINDER] Update Your Resume! - PIU Workshop/Webinar with @IBGEEKBOY

PIU - 2023 Resume Builder Workshop with @IBGEEKBOY

See all posts from Passive Income University