Yes, you'd call this a selective market: select the wrong stock, and there's a 30-40% haircut up ahead. Select the correct stock, and you're positioned for the recovery with modest downside exposure. And with that in mind, PepsiCo, Inc. (NYSE: PEP) is worth a review.

The financial crisis and pronounced U.S. recession that has seen U.S. stock markets slide about 50% has not been kind to Pepsi, and that's part of the appeal here. Institutional investors punished shares from the $75-range in September 2008 to about $45.40 before bouncing, and they're in the $47-50 range now.

When you think about it, corporations are no different than consumers. They see the economic writing on the wall, and they react to it accordingly. So it was no surprise when PepsiCo's (NYSE: PEP) CEO Indra Nooyi said she was down on beverage acquisitions in North America. Instead, she'd like to drive profits in an organic fashion. In my opinion, she's basically saying that she doesn't feel that the economy has hit a bottom yet and that she's got time to look around for prospects to add to her company's portfolio.

I think she's probably correct (if she actually is thinking along those lines), but I would add that, if a particularly compelling prospect came along, I wouldn't necessarily reject it in knee-jerk fashion just because the economy is one scary beast. Remember that PepsiCo, or any company for that matter, can buy other businesses for cheap valuations at the moment. Of course, those other businesses know that, and probably are holding off from putting themselves up on the block. So I do realize that being a value buyer in this climate is more complex than it appears to be at first glance.

She's also on the right track in terms of concentrating on growing internally. I don't think companies focus as much as they should on internal growth. As Nooyi pointed out, organic innovation can indeed be the more attractive economic alternative to pricey buyouts.

Talk about a tough time in the markets. Between the financial crisis and oil prices rising on an almost daily basis, with the Fed damned if it raises rates and damned if it doesn't, the floods in the Midwest are now threatening to make a trip to the supermarket much more expensive. Yes, break out the coupons and pray for sales, because, according to The Wall Street Journal [subscription], food prices are destined for one direction: higher. That's because a lot of farmland has been damaged, throwing the supply-demand dynamic into chaos.

What does this mean for investors? Look for potential pressure on the stocks of companies such as Coca-Cola (NYSE: KO), PepsiCo (NYSE: PEP), Kraft (NYSE: KFT), Kellogg (NYSE: K), General Mills (NYSE: GIS), and Hershey (NYSE: HSY). I happen to own Coke, and I've heard the news reports talking about how higher corn prices will affect Coke and Pepsi because they use corn syrup as an ingredient for their sodas. It's also been pointed out by others that PepsiCo owns Frito-Lay, and since that company manufacturers salty snacks such as Doritos and Tostitos (I love them both), corn prices will also have an impact on that division.

If you're a trader, be wary. We might be in for a rough ride this summer with not only the stocks I've mentioned here, but in a general sense. Since I own Coke, I've been acutely aware of the pullback experienced in that stock as the external pressures surround it. As I write this, the stock is trading at $54.27. The shares were over $65 during their wonderful stay at the 52-week-high suite. So, yes, buyers with short-term mentalities must be wary. However, long-term investors should look upon any pullbacks as potential opportunities for some of these food-selling companies. If you don't intend to trade, then adding to a Coke or Pepsi position might make sense.

Disclosure: I own Coke; positions can change 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.

When my b-school buddy, Jaime, started working in the corporate strategy group at PepsiCo, Inc. (NYSE:PEP), I knew the time had come: soon she'd somehow convince the company to change its ways and become healthy! Starting with that high fructose corn syrup that fills so many of the company's sodas and is (I insist) one of the leading causes of childhood obesity.

Imagine my surprise when I saw one of the front-page headlines for the Wall Street Journal today [subscription required]: "Pepsi Sales Force Tries to Push 'Healthier' Snacks in Inner City." No, it wasn't that scourge of sweetener, HFCS: it was chips. Especially those preservative- and saturated fat-packed Flamin' Hot Cheetos and Nacho Cheese Doritos. I can just see the orange fingers all over Chicago, now.

Company executives are using top-down tactics to push Baked Lays and other lower-fat options in the inner city. Already Pepsi is on my good list for having removed trans-fats (i.e. partially hydrogenated vegetable oils) from the company's chips. Chicagoans, though, are skeptical and the convenience stores where PepsiCo sales efforts are focused are reacting with the speed of dinosaur bones fossilizing. Or thereabouts.

Maybe customers aren't jumping all over themselves for Baked Lays. [And it's interesting to note that these efforts are all the work of outgoing CEO Steve Reinemund, who was relieved of leadership by Indra Nooyi earlier this week -- there's no telling what her plans regarding the healthy sales will be.] But I have an idea, Pepsi! Take out that high fructose corn syrup and replace it with some nice cane syrup, or something else far less chemically altered. Your customers won't notice. And boy will I buy your stock then.

As it is, nice effort. Keep up the good work Pepsi, I'd much rather have corporate efforts wasted (if indeed they are, as the WSJ suggests, beating the corporate head against the inner-city Chicago wall) on trying to convince customers to eat my healthier options than on, I don't know, spying on one another, or padding the pockets of tainted lobbyists. Ya know?

I may be the only one, though. Despite the mention, shares of PEP were down 13 cents today, to $64.78. It's worth mentioning that the stock is only a dollar or so from its 52-week high, and the three-year trend is nuthin' but up. Healthy just may be good for increasing the wealth in your pockets, as well as the pants that hold them.