For years it was the case that Coca-Cola Co. (NYSE: KO) was a key defensive stock to own in a bad market. It is a Dow Jones Industrial Average component after all. In the recession, Coke products became treated as optional items to buy. And now the health concerns over sugar-fizz water are weighing on Coca-Cola. The same applies to PepsiCo Inc. (NYSE: PEP) as its chief rival. The difference between them is that Pepsi is also a snack food play.

24/7 Wall St. wants to know what the current climate is for defensive stocks. Some of the more battered stocks have drawn investor interest of late, but it seems as though the dip-buyers may be worried that the upside is capped.

Coca-Cola Co. (NYSE: KO) has a 5.17-to-1 price-to-book ratio. Its market cap is $170.7 billion, and its forward price-to-earnings (P/E) ratio is 17.5. With a consensus target price of $43.88, the beverage giant has an implied upside of about 12%. Coke’s shares closed at $38.95 on Friday, and the 52-week trading range is $36.83 to $43.43.

PepsiCo Inc. (NYSE: PEP) has a 5.20-to-1 price-to-book ratio. Its market cap is much lower at $127.23 billion. Its forward P/E ratio is also about 17.5. Pepsi’s consensus target price of $89.40 gives it an implied upside of about 8%. Shares closed at $82.95 on Friday, and the 52-week trading range is $77.01 to $87.06.

The first observation is that both stocks still seem expensive against the market when you consider their forward earnings valuations. From 2014 to 2015, the revenue growth of for Pepsi is expected to be only 4.1%, versus only 4.4% for Coca-Cola. Not much growth. Pepsi’s dividend of 2.7% compares to about 3.1% for Coca-Cola.

Both dividends and growth rates are within distance of each other enough, but the reality is that investors just are not treating soda companies with the same defensive parameters any longer. Negative reports on diet drinks and regular sugary soda drinks routinely come out.

It almost hurts to say, but the trends of 2010 to 2014 for case volumes in North America have something loosely in common with cigarette case volumes. We do not suggest that a Coke or a Pepsi is in the same league as a cigarette by any stretch of the imagination. We also will not say that investors flock to Coke and Pepsi in the same manner that they used to.

Maybe a wave of new healthier products can help the companies down the road, or maybe the international markets can offset the weak North American business case volumes. Maybe.

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