(Adds Jim Cramer's comments on Cisco and corrects Nelson Peltz' first name.)
NEW YORK ( TheStreet) -- PepsiCo (PEP - Get Report) is slightly lower Thursday after beating on bottom-line estimates but failing to beat revenue expectations. The company increased its annual dividend to $2.62 per share from $2.27 and also raised its share buyback program to nearly $5 billion.
TheStreet's Jim Cramer, co-manager of the Action Alerts PLUS portfolio, said investors should definitely like the company's plans for its productivity, keeping to its current $1 billion per year to a projected five-year, $5 billion plan for 2015 to 2019.
However, despite the productivity targets and return to shareholders, Cramer admitted it is a difficult environment for soda companies because carbonated drink sales have been taking a hit.
He said it would be nice to see more organic growth from the company's Frito-Lay division, where revenue rose 4% for fiscal 2013. This shines in comparison to Quaker Foods' North American operating profits, which fell 15% for the quarter and 11% on the year. Cramer called it "unacceptable" for the company.
He also disagrees with others, notably investor Nelson Peltz, who want PepsiCo to split its beverage business from its snack foods division. "Listen up, Nelson Peltz," Cramer said. "I like the combination."
At current levels, Cramer likes the soda companies, such as Dr Pepper Snapple Group (DPS - Get Report), because their shares have declined and the buybacks are big.
Cramer was far more negative about Cisco (CSCO - Get Report), whose results are "not something I like to see." CEO John Chambers has "no leg to stand on" because "you have lower sales, you have lower gross margins... Look at these numbers," he said, scanning the company's report.
"They are getting their lunch eaten by, I believe, Alcatel-Lucent (ALU - Get Report), of all things, and that's not good," Cramer said.