Bensignor remember, is the one who nailed Bank of America (BAC) on this show, back at the beginning of March… he gave us a double from when he featured his call on this show, and it was quite a move… Bensignor thinks that Coke is a buy on any pullback, this is really interesting… let me pull back to the low $40’s of which is pretty close to here right… the stock was down to $43, on a very bad day… it was off $1.25... now, what does he see in the chart… this is really important… this is what they are all looking at in the big offices… they are all opening their desk drawers and they are looking at the chart at these big mutual funds.

First, Coke’s 2009 lows are right up against the 2006 low, the 2004 low, and the 2003 low… that makes the level seem like a long term low… one that is firmly in place so people feel emboldened by the fact that that is where the stock has held before… the other thing is very, well it is important but it is a little more complicated… it is something that he calls, and what other people call it, is the demark models… know all you need to know about this method, is that instead of helping to identify trends, like most chartists do, the demark models try and show when a trend is over… on a chart you want to look for the number 13 in red… now, I mean I have got them circled right here… to show you how they have predicted big trend changes in the past… and you can see that we have hit another one… which is a buy… a buy signal, as it indicates to technicians that the sellers have become exhausted… they do not want to sell down here anymore… this is actually only the third down side exhaustion buy signal in Coke’s chart in the past 4 years… but the earlier ones along with the sell signals, have all been pretty spot on.

So, again, people feel comfortable at this level… particularly because look how many points you could possibly get if you are right…

No Coke… Pepsi.. .is anyone out there old enough to remember that one?…

[ Jim then showed a clip of old Saturday Night Live, featuring the John Belushi/Dan Ackroyd skit, "No Coke, Pepsi" ]

This is my analysis... I like Pepsi (PEP*) like John Belushi… I mean those guys were good weren’t they… you should know that I once led a pilgrimage to John Belushi’s grave in Martha’s Vineyard, although, I was the only one that was sober and aware of the surroundings at the time.

Anyway, do I favor Pepsi over Coke… because while it looks like both companies will benefit from the potential coming stabilization in North American beverages… Pepsi is well ahead of the curve, when it comes to their own destiny… Pepsi is moving to buy the remaining share of its bottlers in order to create a leaner, more nimble business model… that will improve the speed of decision making, strengthening its ties to retailers, and also I think save $200m or .15 cents per share… I think that it is savvy.. in sharp contrast to Coke, which may have a strained relationship with its main North American bottler… why buy Coke when it really reported a nothing quarter today, that I think could lead many analysts to cut numbers… when you can buy Pepsi which beat the streets consensus by .04 cents when it reported yesterday… the company had the misfortune of reporting on a terrible, horrible, no good, very bad day.. and the stock is below where it was when the good news came out… and it did not help that Coke reported that number that people didn’t like… bad news for those of us like me, who already have some Pepsi in my charitable trust, ActionAlertsPlus.com, but good news for anyone who wants to buy the stock now, and has just been looking for the right entry point… and I think you have got it.

Because Pepsi’s business is much less international than Coke’s… Pepsi is only 35% international, Coke is 80%… I am less worried about the vulnerability to a strong dollar… strong dollar is worse for Coke than Pepsi… Pepsi also has room to grow internationally… Pepsi is going to take advantage of that fact investing $3b in Mexico, $1b in China, on top of a recent acquisition in Russia… it also has the more diversified business mix… Frito-Lay makes it the world leader in snacks… Coke is really beverages, although they have made some good acquisitions… plus Pepsi also has a nifty restructuring program, $350 to $450 million a year cost cuts… gives them the flexibility to create new products… the money will also be able to be used to promote and market old products… both companies are benefiting from lower commodity costs… and if the cola war has come to an end and the North American business stabilizes… both Coke and Pepsi will win… but I think Pepsi wins more…. I think that it is in a much better position to capitalize on any improvement… and much more control of its own destiny… no Coke… Pepsi (PEP*).

The bottom line…