"What's not to like about Pepsi (NYSE: PEP) these days?" asks John Reese, who has chosen the stock as his top conservative idea for 2008.

His Validea newsletter explains,  "Pepsi's exceptional fundamentals garner approval from the 'Guru Strategy' computer models based on the approaches of two legendary investors -- Warren Buffett and Peter Lynch."

"The beverage and snack giant owns several star American brands (including its famed cola, Doritos, Tropicana, Gatorade, and Quaker Oats.

"It also has a foothold in a bunch of emerging markets with booming economies, and its environmentally-conscious streak earned it the No. 1 ranking on the Environmental Protection Agency's 2007 corporate 'Green Partners' list.

"While Buffett has long been a fan of Coke's stock, it's Pepsi that appears to be more, well, 'Buffett-like' these days.

"The company has increased its earnings in eight of the past ten years, growing earnings per share from $0.95 to $3.34 in that time -- just the kind of steady, predictable growth my Buffett-based model likes.

"In addition, Pepsi's average return on equity over the past decade is an exceptional 29%, almost twice my Buffett model's 15% standard.

"That's a sign that management is doing a good job with shareholders' money, and that the company has established what the Oracle of Omaha refers to as a 'durable competitive advantage' over its peers.

"My Lynch-based model also thinks the time is right to buy Pepsi. Lynch famously used the P/E-to-Growth ratio to find growth stocks selling on the cheap, and, at 0.99, Pepsi's P/E/G falls into the range that gets approval from my Lynch-based model.

"Plus, Pepsi has a debt/equity ratio of just 18%, showing the kind of conservative financing that Lynch valued.

"Moreover, if you're still jittery over the U.S. economy, consider this: My Lynch-based model views Pepsi as a 'stalwart', the kind of high sales/moderate growth stock that Lynch found offered protection in tough times.

"Indeed, with its incredible name recognition, increasing presence in expanding foreign markets like India and South America, and stellar fundamentals, a few shares of Pepsi should hit the spot in 2008 -- even if the economy lags."