To achieve the consistent outperformance that The Procter & Gamble Company (NYSE:PG) has, it clearly knows how to innovate and launch new products. In an effort to enhance the company’s future growth prospects, in early June 2013 they announced a streamlining of their business units into four industry-based. This reorganization is intended to spur faster growth and a renewed focus on their leading businesses. This change is warranted considering the company’s sales growth has lagged competitor, Unilever N.V. (ADR) (NYSE:UN). According to data compiled by Bloomberg Industries PG has averaged an annual sales growth of 2% over the past three years versus Unilever N.V. (ADR) (NYSE:UN) who has delivered 8.7%.
With Lafley back on board as CEO, a renewed industry-based focus, and continued cost cutting initiatives expected to result in $10 billion in savings through 2016, PG appears well position for the future.
Another company with exciting growth prospects is PepsiCo, Inc. (NYSE:PEP). There are rumors that Pepsico is considering a buyout of Sodastream International Ltd (NASDAQ:SODA), the maker of DIY soda machines and syrups. Taking over a company famous for turning tap water into fizzy drinks appears to be a logical decision for the beverage and snack food products company and with $6.7 billion in cash it has the means to do so.
An acquisition would allow PepsiCo to diversify its operations and drive growth in a market that appears to be flourishing. Sodastream International Ltd (NASDAQ:SODA) has achieved 33 percent annual revenue gain in the past five years and is projecting a $1 billion revenue target in 2016. With Sodastream International Ltd (NASDAQ:SODA) machines in 6.5 billion households around the world, this appears to be a sustainable trend that will drive growth for PEP.
If PepesiCo needs a little advice on successfully entering a new market, perhaps they should look to Starbucks Corporation (NASDAQ:SBUX). Starbucks has beat the S&P 500 over the YTD, 1 year, and 5 year time periods and it does not appear to be simmering down.
One of the most promising growth opportunities for the company is in its at-home premium single-serve segment which is estimated to be an $8 billion market. With Keurig machines becoming as prevalent as microwaves in many homes, this presents Starbucks with significant growth opportunity. The company made a wise decision to license its beans and brand to Green Mountain Coffee Roasters Inc. (NASDAQ:GMCR) Keurig to participate in this growing market. Starbucks has not only partnered with the leader in single serve coffee, it has also developed the Verismo machine, a K-cup capable machine of its own.
PG, PepsiCo, and Starbucks remain solid long-term investment choices because these companies have been successful at reinventing themselves to adapt to a changing business environment whether that means bringing back a seasoned leader and reorganizing, contemplating an acquisition to gain exposure in a new market or partnering with a leader and developing innovations to compete in a new business.
The article Do Couponers Know Something We Don’t? originally appeared on Fool.com is written by Kelli Bhattacharjee.
Kelli Bhattacharjee has no position in any stocks mentioned. The Motley Fool recommends Green Mountain Coffee Roasters, PepsiCo, Procter & Gamble, SodaStream, and Starbucks. The Motley Fool owns shares of PepsiCo, SodaStream, and Starbucks. Kelli is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
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