Some of the gain isn't organic -- cost savings from Gatorade account for about 5 percentage points -- but you still can't quibble with Pepsi's performance. Second-quarter sales rose by 6.8% to $6.5 billion, and net income was $1.0 billion, or $0.58 per share, up from $875 million last year.
Worldwide volume grew a healthy 5% while the remaining top-line growth came from price increases. Its beverage division saw 4% volume gains, an impressive increase in the mature U.S. market that was aided by the new Sierra Mist line. Pepsi's Frito-Lay division made up 38% of total profits on a 6% gain in sales.
Management said it remains on track to earn $2.16 to $2.19 per share in 2003, putting the $46 stock at a 21 multiple to forward earnings.