Brown: Get Some Pop From Pepsi Bottling

Pepsi Bottling offers portfolios some effervescent opportunity.
By Tim Brown ,

"Past performance is no indication of future performance."

It's a phrase that is common in the investment world. Anyone who has ever purchased a mutual fund has probably heard them or read them before, and it's true in all walks of life, but especially in sports. Two years ago the Cleveland Browns won just four games while losing 12. Last year the team turned things around to go 10-6. Many teams went the other direction. The New York Jets (10-6), Baltimore Ravens (13-3) and Kansas City Chiefs (9-7) were playoff teams two years ago, but last season both the Jets' and the Chiefs' record fell to a meager 4-12 and Baltimore managed just five wins.

True dynasties, which are consistently strong performers over an extended time frame, are even rarer. It's hard to repeat. That's due to a number of reasons, including player turnover and increasing parity, especially in the NFL. However, the main reason is because the conditions and circumstances are rarely the same from year to year and the cast of characters changes. The New England Patriots have made four Super Bowl appearances in the last seven years and won three of those. The Dallas Cowboys won three times in four years, the last one coming in January 1996 over the Pittsburgh Steelers. The Buffalo Bills dominated the AFC in the 1990s, reaching the Super Bowl four years in a row, but losing all four times.

The examples may be from the sports world, but the lessons apply to my stock-picking mentality as well. If you want to find a winner, you don't look at where it's been, you look at its current components and where it is going.

A team can have a great track record over the last few seasons, but now could have lost a star running back in the offseason, have an offensive tackle recovering from knee surgery, and an ageing quarterback with diminishing skills. Or, just as important, another team in its division may have made some key offseason acquisitions, increasing the competition among direct rivals.

Likewise, a company that has had some key management changes, a mentality that is outdated for the current business environment, or a new competitor stealing market share, may not live up to its reputation.

The point is this: down doesn't necessarily mean out.

Pepsi Bottling Group

(PBG)

is my pick for today. It's a great company and a winner, but what makes this an attractive stock to me is that is underestimated by Wall Street. Shares closed at $33.38 on Friday, which puts it nearer the low point of the past 52-weeks ($31.53) than its peak ($43.38). I think it can only go up in the long-term

"Keep Moving the Chains"

Know What You Own

: PBG operates in the beverages industry, and some of the other stocks in its field include

Coca-Cola

(KO) - Get Report

,

Dr. Pepper Snapple Group

(DPS)

and

Kraft Foods

(KFT)

. These stocks closed at $57.07, $26.50 and $32.51, respectively. For more on the value of knowing what you own, visit TheStreet.com's

Investing A-to-Z

section.

At the time of publication, Brown had no positions in stocks mentioned, although positions may change at any time.

Tim Brown played 16 seasons in the NFL, where he made nine Pro Bowls. After a brief stint with the Tampa Bay Buccaneers in 2004, Brown retired as an Oakland Raider. He was a Heisman Trophy winner in college for Notre Dame.

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