Investment Analysts’ Recent Ratings Changes for Pepsico (PEP)

A number of firms have modified their ratings and price targets on shares of Pepsico (NYSE: PEP) recently:

  • 12/13/2017 – Pepsico is now covered by analysts at Deutsche Bank AG. They set a “buy” rating and a $132.00 price target on the stock.
  • 12/12/2017 – Pepsico was upgraded by analysts at Zacks Investment Research from a “sell” rating to a “hold” rating. According to Zacks, “PepsiCo has been doing well on the back of significant innovation, continued momentum in Frito-Lay business, revenue management strategies, improved productivity and cost-saving initiatives, along with better market execution. Moreover, an improving economy, better industry pricing dynamics and a consistency in positive innovation bode well. It rolled out several products recently which management believes will drive sales and profits in 2017. That said, growing health awareness has been hurting the CSD category, resulting in a 4% volume decline in the first nine months of 2017 in North America. Again, rising volatility in global markets and increasing currency headwinds may dampen growth. Meanwhile, PepsiCo’s shares have gained 12.2% year to date, underperforming the industry’s growth of 13.4%.”
  • 12/5/2017 – Pepsico was downgraded by analysts at Zacks Investment Research from a “buy” rating to a “hold” rating. According to Zacks, “PepsiCo has been doing well on the back of significant innovation, continued momentum in Frito-Lay business, revenue management strategies, improved productivity and cost-saving initiatives, along with better market execution. Moreover, an improving economy, better industry pricing dynamics and a consistency in positive innovation bode well. It rolled out several products recently which management believes will drive sales and profits in 2017. Meanwhile, PepsiCo's shares outperformed its industry in the last three months. That said, growing health awareness has been hurting the CSD category, resulting in a 4% volume decline in the first nine months of 2017 in North America. Again, rising volatility in global markets and increasing currency headwinds may dampen growth.”
  • 12/4/2017 – Pepsico was upgraded by analysts at Zacks Investment Research from a “hold” rating to a “buy” rating. They now have a $131.00 price target on the stock. According to Zacks, “PepsiCo has been doing well on the back of significant innovation, continued momentum in Frito-Lay business, revenue management strategies, improved productivity and cost-saving initiatives, along with better market execution. Moreover, an improving economy, better industry pricing dynamics and a consistency in positive innovation bode well. It rolled out several products recently which management believes will drive sales and profits in 2017. Meanwhile, PepsiCo's shares outperformed its industry in the last three months. That said, growing health awareness has been hurting the CSD category, resulting in a 4% volume decline in the first nine months of 2017 in North America. Again, rising volatility in global markets and increasing currency headwinds may dampen growth.”
  • 11/12/2017 – Pepsico had its “hold” rating reaffirmed by analysts at Royal Bank of Canada.
  • 10/31/2017 – Pepsico was upgraded by analysts at Zacks Investment Research from a “hold” rating to a “buy” rating. They now have a $123.00 price target on the stock. According to Zacks, “PepsiCo reported mixed third-quarter 2017 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. Nonetheless, this is the sixth consecutive quarter of positive earnings surprise. On a year-over-year basis, core earnings and revenues grew 6% and 1.3%, respectively. PepsiCo has been doing well on the back of significant innovation, continued momentum in Frito-Lay business, revenue management strategies, improved productivity and cost-saving initiatives, along with better market execution. Revenues increased 1.7% on an organic basis, primarily driven by higher demand for beverages/food/snacks in the Asia, Middle East and North Africa, Europe Sub-Saharan Africa and Latin America segments. Total volumes however declined 1% during the quarter against flat growth in the previous quarter. Core gross margins also contracted 15 basis points.”
  • 10/30/2017 – Pepsico was downgraded by analysts at Zacks Investment Research from a “buy” rating to a “hold” rating. According to Zacks, “PepsiCo reported mixed third-quarter 2017 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. Nonetheless, this is the sixth consecutive quarter of positive earnings surprise. On a year-over-year basis, core earnings and revenues grew 6% and 1.3%, respectively. PepsiCo has been doing well on the back of significant innovation, continued momentum in Frito-Lay business, revenue management strategies, improved productivity and cost-saving initiatives, along with better market execution. Revenues increased 1.7% on an organic basis, primarily driven by higher demand for beverages/food/snacks in the Asia, Middle East and North Africa, Europe Sub-Saharan Africa and Latin America segments. Total volumes however declined 1% during the quarter against flat growth in the previous quarter. Core gross margins also contracted 15 basis points.”

Pepsico, Inc. (PEP) opened at $118.02 on Friday. Pepsico, Inc. has a one year low of $101.06 and a one year high of $119.39. The company has a quick ratio of 1.21, a current ratio of 1.35 and a debt-to-equity ratio of 2.32. The firm has a market capitalization of $166,959.58, a price-to-earnings ratio of 22.93, a PEG ratio of 3.19 and a beta of 0.68.

Pepsico (NYSE:PEP) last posted its quarterly earnings data on Wednesday, October 4th. The company reported $1.48 EPS for the quarter, beating analysts’ consensus estimates of $1.43 by $0.05. The company had revenue of $16.24 billion during the quarter, compared to analysts’ expectations of $16.35 billion. Pepsico had a return on equity of 59.68% and a net margin of 10.97%. Pepsico’s revenue for the quarter was up 1.3% compared to the same quarter last year. During the same quarter in the prior year, the business earned $1.40 earnings per share. research analysts expect that Pepsico, Inc. will post 5.22 EPS for the current fiscal year.

The company also recently disclosed a quarterly dividend, which will be paid on Monday, January 8th. Investors of record on Friday, December 1st will be given a dividend of $0.805 per share. This represents a $3.22 dividend on an annualized basis and a yield of 2.73%. The ex-dividend date of this dividend is Thursday, November 30th. Pepsico’s dividend payout ratio (DPR) is presently 66.53%.

In related news, insider Ramon Laguarta sold 21,449 shares of the company’s stock in a transaction on Tuesday, October 10th. The stock was sold at an average price of $110.51, for a total transaction of $2,370,328.99. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. 0.26% of the stock is currently owned by corporate insiders.

PepsiCo, Inc is a global food and beverage company. The Company’s portfolio of brands includes Frito-Lay, Gatorade, Pepsi-Cola, Quaker and Tropicana. The Company operates through six segments: Frito-Lay North America (FLNA), Quaker Foods North America (QFNA), North America Beverages (NAB), Latin America, Europe Sub-Saharan Africa (ESSA), and Asia, Middle East and North Africa (AMENA).

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