Will not give you the intrinsic value of the company. You have to take the intangibles into account. That's why Coke sells at a p/e of around 50. If you ran the numbers on Coke two years ago, it would have seemed wildly overvalued, and look what's happened since then. It's only growing 15% a year, why is the p/e 50? Brand equity, lack of meaningful competition, and low interest rates, among other things.
Just my opinion. Buffett would never buy Pepsi anyway since he sits on Coke's board and it would be a huge conflict of interest.
I know the /a means a pre-effective ammendment but does that mean they ammended the document and after I spent about 2 hours reading it I will need to re-read it for the ammendment because I looked for the ammendment through the S-4/a. THanks
<<Pepsi isn't a turnaround company play as much as GEICO was when Buffett bought it on the brink of bankruptcy. If he understands the turnaround, he'll buy it. There are no hard and fast rules. >>
Hehe Don't you get the feeling that Mr. Buffett always fantasized about owning GEICO, ever since he was a little boy? That's one of the few companies I believe he bought with his heart instead of his head. Now GRE... there's one he is buying with his head :) In any event, I wouldn't buy Pepsi yet. I could be wrong, but until Coke's business plan falters, I just don't see how it can compete. Having said that, I drink more Pepsi in a day then Mr. Buffett does Cherry Coke :)