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Pepsi Mixes Snack Flavors for Variety

Zacks Equity Research

PepsiCo Inc.’s (PEP) Frito Lay division has come up with a unique snack combination of the two popular brands — Cheetos and Doritos. The combo consists of Cheetos Flamin' Hot cheese flavored snacks and Doritos Dinamita Chile Limon rolled tortilla snacks.

The innovative combination has created a unique snack which is both crunchy and spicy. The Cheetos Flamin' Hot / Doritos Dinamita Chile Limon Mix are available at stores throughout the country in 8-oz and 3.25-oz bags priced at $3.49 and $1.49, respectively.

With the change in consumer preferences, there is a huge demand for new snack products with unique flavors. The Cheetos Flamin' Hot / Doritos Dinamita Chile Limon Mix is the perfect anytime snack which helps maintain a steady energy level throughout the day.

Product innovation plays a huge role in PepsiCo’s success. The company regularly creates new flavors of its existing products while maintaining a robust pipeline of new ones.

PepsiCo’s overall product portfolio consists of 22 brands including Pepsi, Mountain Dew, Gatorade, Tropicana, Lay's, Doritos, Cheetos and Quaker, each generating annual retail sales of more than $1 billion. Though PepsiCo has the competitive advantage of selling both snacks and beverages, which are complementary food categories, the present product introduction is in line with its long-term strategy to shift the business mix toward snacks. The Zacks Rank #4 (Sell) company is more inclined to do so because of its dwindling carbonated soft drink volumes since past few quarters.

Some better-ranked stocks in the consumer goods sector are Coca-Cola Enterprises Inc. (CCE), Dr Pepper Snapple Group, Inc. (DPS) and Monster Beverage Corporation (MNST). All these stocks carry a Zacks Rank #2 (Buy).

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