PepsiCo (NYSE: PEP) reported Q4 and full-year earnings today, and the Street liked what it saw. Personally, I'm a fan of Coca-Cola (NYSE: KO), mainly because I own the stock -- well, that's pretty much the only reason, since I actually prefer Pepsi's soda over Coke's (although I do like Diet Coke best of all). As of this writing, it's up about 5%.

Net revenue grew 17% for the fourth quarter and 12% for all of 2007. That's great double-digit growth, but the bottom line actually declined 29% in the fourth quarter and rose a flat 2% for the full year. That was on a GAAP basis. Excluding various items, net income actually grew 8% in Q4 and 13% in 2007. Full-year operating cash flow jumped 14%, and it was more than enough to cover capital spending and the blue-chip dividend (the latter of which is a key reason why investors put this stock on buy, hold, reinvest, and forget!).

Snack volume -- remember, Pepsi owns the tasty Frito-Lay portfolio and the Quaker brand -- grew 6%, while beverage volume expanded by 4%. Pepsi expects higher operating cash flow for fiscal 2008 -- $7.6 billion versus the $6.9 billion generated in 2007 -- and it is planning to continue share repurchases. Yes, I suppose I'd rather you buy shares in Coke since I own them, but truth be told, investors will probably do well owning either beverage company (I do concede that I envy the Frito-Lay asset).

Disclosure: Steven Mallas owns shares in Coke, and might buy more at any time.

Even in a recession, people will "snack" themselves to the point of sugar highs so powerful that they will think the economy is still expanding. According to Reuters, "PepsiCo (NYSE: PEP) expects its business based on "comfort foods" to be resilient to a U.S. economic slowdown, Chief Executive Indra Nooyi said on Wednesday."

The point is probably well-founded. Soda and chips are still something people can enjoy for a few dollars. And many people are addicted to the sugar and salt. And it makes Pepsi and rival Coke (NYSE: KO) effective hedges against a downturn.

Pepsi sells for just over $69 now, down from a 52-week high of almost $80. It has a yield of 2.1% and $2.2 billion in cash and short- term investments. The company has an operating margin of about 20%. In the last quarter, operating income was $2.1 billion on revenue of $10.2 billion. Coke's financial dynamics look about the same.

All in all, this makes these stocks "safe" bets if the markets continue to fall.

Douglas A. McIntyre is an editor at 247wallst.com.

I don't think I can count how many times I have heard in my career "you can always count on Coca-Cola, no matter what condition the economy is in." It's as true today as ever. With the markets reacting in a volatile manner, globally, Coca-Cola Co. (NYSE: KO) is as solid as a rock. This $125 billion market capitalization company is only $2 off of its 52-week high of $56.71. The dividend yield is a solid 2.5% and Coca-Cola has a nice history of raising the payout.

Coca-Cola is one of the world's most recognizable brands. Coca-Cola was a global company before most of us knew what "globalization" meant. It is one of the United States most important exports. Besides the flagship product of Coke, the company also markets consumer favorites like Diet Coke, Fanta and Sprite. Latley, the company has expanded its product offerings to include bottled water as health-conscious consumers have gravitated to this sector of the beverage industry. Coke has successfully diversified its revenue and earnings base by expanding to this valuable part of the industry.

The amazing aspect to the Coca-Cola story is how professional portfolio managers view this company. The revenue and earnings growth rates are only about 10%, but yet Coca-Cola sports a hefty price-earnings multiple of 24 times. Portfolio managers have such confidence in the quarterly performance of Coca-Cola and the absolute consistency of its numbers that many refer to Coca-Cola as "the sleep well stock." This means they do not have to worry quarter-in and quarter-out about Coca-Cola achieving stated expectations: it's virtually automatic.

Michael J. Fox. Michael Jackson. Madonna (for one brief flickering moment). While second-largest soft-drink concern PepsiCo (NYSE: PEP) isn't recruiting its 80s spokespersons back to the fray, the company is bringing back the old-fashioned taste test, in an effort to prove the flavor of Diet Pepsi superior to that of the better-selling Diet Coke - the second-most popular brand under the Coca-Cola (NYSE: KO) umbrella.

Starting today, PepsiCo will be handing out samples of Diet Pepsi, in newly designed cans, and boasting the claim that their calorie-free product has "more cola taste." A recent taste test, reminiscent of the familiar "Pepsi Challenge" from days of yore, yielded positive results, with 56% of respondents believing Diet Pepsi tasted more like "real" (full-calorie) cola, while 41% preferred Diet Coke.

Sales of diet soda are on the decline, as sports drinks and bottled water gain popularity, but the Diet Pepsi brand is losing momentum at a faster clip than Diet Coke. According to an article in today's Wall Street Journal, unit case volume of Diet Coke slipped 0.1% in 2006; Diet Pepsi volume dropped 1.0% last year.

The once-proclaimed "choice of a new generation" has an uphill battle ahead of it . In our "Battle of the Brands" feature last month, Pepsi was felled by Coke, 41% to 59%.

Maybe the Diet brand will have better luck.

Beth Gaston Moon is an analyst at Schaeffer's Investment Research.

I remember the first time I saw excessive drinking of diet soda. See, we mostly drank water in my parents' home, so I got used to that. One day, during lunch at a a friend's who was always on a diet, I noticed she was drinking diet Coke (or Pepsi, I can't really remember). Responding to my inquiry, she explained that she'd rather spend the calories allotted to her in her diet on food rather than on drink.

Well, today I've read about this fascinating study that found that liquids make up 22% of calories in the average American's diet. Meaning that while many Americans only count calories from food, in fact, many of their daily calories are comprised of drinks -- 22% of them.

Apparently, Americans drink on average 38 ounces of water (zero calories), followed by 17.5 ounce sugary soft drinks, 7.5 ounces of milk and 8.9 ounces of coffee daily. 6.4% of Americans' diet is made up of soft drinks, while the percentage is higher for teenagers.

This trend might be declining as health and wellness awareness have increased in the past decade. This trend along with some schools removing vending machines containing full sugar soft drinks also caused companies such as PepsiCo Inc. (NYSE:PEP) and Coca-Cola Co. (NYSE:KO) to release healthier products.

There have been many controversies concerning sweeteners so I'm not sure that having so much artificial sweeteners such as aspartame or saccharin in one's diet is that healthy either. Regardless, it seems that my friend was right: Don't forget to count your drinks when dieting. Alas, this goes for beer and martinis as well...

Remember the 90s? Ahh, the 90s, when I was in high school and college and we all believed that (a) bagels and cereal were diet foods and (b) drinking a Diet Coke with your pizza was a good way of cancelling out the calories.

The Coca-Cola Company (NYSE:KO) has announced that it will be releasing a new calorie-burning soft drink called "Enviga" in November, just in time to balance out your Thanksgiving dinner I suppose. That's right, I said "calorie-burning." It could be that my pizza/diet soda strategy from 1992 could finally actually work!

Enviga uses green tea extract (EGCG, which has nothing to do with an EKG, much though my mind immediately leaps there), caffeine and calcium, and the company says it is actually proven to burn calories. Investors seem cautiously optimistic and have sent the stock up a bit, about 20 cents, since the announcement.

I don't know. First of all: the packaging looks to me like those alcoholic drinks -- totally the wrong association for Coke's target market. Second, I connect calorie-burning with the fen-phen troubles of the late 90s (yep, those darned 90s again). Third, as Sarah Gim from Slashfood points out, Enviga is only "proven" to burn calories in "healthy people with a lean to normal body type" -- those that don't really need to burn any more calories. Sarah, Sarah! Don't you know that customers don't read the small print??

It remains to be seen whether Enviga will crash and burn due to confusing packaging, or it will soon be on the desks of millions of lean-to-normal female high school and college students, who are certain that they're in need of losing just five more pounds. If I know anything about their collective psychology, I'd be betting on option #2.