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Portfolio Check: Pepsi

|Includes: PepsiCo Inc. (PEP)

Pepsi reported earnings for Q4 2013 on Wednesday(found here). Earnings and revenue increased from the previous year. As a long term shareholder, I was pleased with the performance. Furthermore, Pepsi announced that they were going to increase the amount of money that is returned to shareholders. They plan on buy backs (retirement) and increased the dividend by 15%. Additionally, they will begin a new five billion plan to reduce costs over five years.

The markets reaction to Pepsi was negative and the shares have fallen for the previous two trading sessions. Pepsi has fallen approximately 6% this year and has returned about 8% over the last year. By comparison, the S&P500 has returned 21%. This fall seems unwarranted and potentially related to Pepsi deciding against splitting up the beverages and snack business units.

In light of the earnings report, I will need to analyze my position and determine whether to purchase some additional shares. I didn't see anything that alarms me, but will need to dig a deeper and make sure I am not missing something.

Disclosure: I am long PEP.

Additional disclosure: I may buy additional shares of Pepsi over the next 3 business days.