Analyzing ROIC of Soft Drink Industry and Airline Industry with Porter’s Five Forces.docVIP

Analyzing ROIC of Soft Drink Industry and Airline Industry with Porter’s Five Forces 　　【Abstract】Porter （2008） reports that return on invested capital （ROIC） essentially reflects how well a company can generate earnings from the money it invests in itself. If a companys returns are greater than its cost of capital， its creating value for shareholders. Based on the data and Porters Five Forces Framework， this paper gives suggestion about whether readers should invest in Airline stock. 　　【Key words】Michael Porter’s five forces model； ROIC； soft drink industry； airline industry 　　【摘要】?~克尔?波特的《新论竞争五力》文中写道，投资资本回报率（ROIC）反映了一家公司能够从自己投资的资金中所获得收益的情况。如果公司的回报大于其成本，则为股东创造了价值。本文基于波特五力模型分析，给出读者是否应该投资航空公司股票的建议。 　　【关键词】波特五力模型 投资资本回报率 软饮料产业 航空公司 　　I. Introduction 　　There are a number of metrics that can be used to evaluate a company or industry. One such financial metric is Return on Invested Capital （ROIC） which is calculated by dividing earnings before interest and taxes by the difference between average invested capital and excess cash. In order to compare industries as different as soft drinks and airlines， ROIC is an important metric in comparing industries as different as soft drinks and airlines as it takes into account the capital investment required. During the timeframe presented in Porter’s article， the average ROIC in the U.S. for the soft drink industry was 37.6% （90th percentile） and for the airline industry was 5.9% （10th percentile）. During the same time period the average ROIC for U.S. industries was 14.9%. Porter’s five forces （established rivals， customers， suppliers， entrants， and substitute offerings） can be used to explain the difference in ROIC for these two industries. 　　II. Porter’s Five Forces Framework Analysis 　　When comparing the airline and soft drink industries， the marketing spend as a percent of sales is comparable. With 42.3% and 27.5% of the market in 2015 respectively， Coke and Pepsi are the leaders of the soft drink industry . From 20