PepsiCo (PEP) Buy, Sell or Hold

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PepsiCo (PEP)

140.68

-1.24 (0.87%)

as of Jun 8, 2026, 8:00:00 pm Market Open.

234 watching

Investor Insights

Jun 7, 2026, 12:00 am

This summary was created by AI, based on 7 opinions in the last 12 months.

PepsiCo (PEP) is experiencing challenges due to the rising popularity of GLP-1 weight-loss drugs among health-conscious consumers, especially the younger generation. Despite its long-standing Frito-Lay snack division and a solid dividend yield of nearly 4%, commentators express concerns about shifting consumer preferences impacting sales. The company reports earnings soon, and while some believe it has strong growth potential, others highlight struggles within the snack division. Activist investor Elliott Management's recent stake in PepsiCo suggests some see it as undervalued, viewing the current price as a bargain. However, there are underlying headwinds, including competition from healthier options and an overall cautious economic outlook that raises questions about future growth prospects.

Consensus

Cautious

Valuation

Undervalued

Similar

CocaCola,KO

BUY

Allan Tong’s Discover Picks Similarly, Pepsi made its numbers by raising prices by 17% and shrinking only 1% in product volume. Revenues were up 9% for Q3 YOY, totaling $21.97 billion and beating the street’s $20.84 billion. Its Q3 EPS came in at $1.97 well ahead of the expected $1.84. This despite weakness in Frito-Lay’s North American division. Total organic growth clocked in at 16%. Not only that but management raised full-year guidance from 10% organic revenue growth to 12% and raised EPS growth from 8% to 10%. Back to Frito-Lay: volumes dipped in the quarter, but revenue did pop 20%. Similarly, Quaker Food North American revenue rose 15% despite another decline in volume. Read 3 Fast Food Stocks to Nibble On for our full analysis.

BUY

They have pricing power, with 17% higher prices in products, but were only 1% down in volume. So, people are still spending.

BUY ON WEAKNESS

She wished she had bought this. She's been deterred because it always trades at a pricey 26x forward PE. They beat and raise no matter what over the past DECADE. Total organic growth by 16% let by Frit0 Lay North America (up 20%). Why? They have the products and pricing power. This is definitely a buy on pullback.

BUY

Wage growth and consumer spending are tied. Pepsi is a bellweather among consumer staples at 20% topline growth driven by higher prices. So, consumers can deal with price hikes. The staples can keep the price increases going even as their costs come down.

BUY

They report Tuesday morning. He expects a good story from because their input costs have fallen so much, including corn and aluminum. He's confident with them as long as transportation costs are under control.

WEAK BUY

Coke is very well run. Pepsi pays a 2.7% yield and is run well, too, but he prefers Coke.

PAST TOP PICK

(A Top Pick May 28/20, Up 38%) Still a great stock, but he sold it recently because of valuation and price appreciation. Staples are a strong performer this year, but PEP is trading at the high end of its range. Still likes it and will buy it when defensives falls out of favour.

WEAK BUY

It reports Tuesday, and he expects good numbers though he worries about freight costs and supply chain issues. Pays nearly a 3% yield.

COMMENT

PEP-Q vs. COKE-Q. He would be more inclined to take Pepsi as they diversified better and the growth has been better over the last few years.

BUY ON WEAKNESS

They report Tuesday. They'll deliver great numbers, but will need to explain why raw costs, especially freight, keep going up. Shares trade too high, so buy only if share pullback after earnings.

COMMENT

The consumer staples sector had been an under-performer. Now it is still a headwind. It is a defensive piece for a portfolio, however.

DON'T BUY

Defensive, so it's been underperforming the broader S&P since last March. Bit expensive. 24x forward earnings for 7% earnings growth. Nice dividend at 3%. Higher end of 10-year valuation. Consumer staples is not a focus for him right now.

BUY

He expects a great report from them on Thursday, because their snack business given them more consumer exposure than Coke has. Their last quarter was fine, but the market yawn from being bored with consumer staples. He bets their business is accelerating.

COMMENT

An analyst raised her price target of PEP to $169 in a catch-up trade, following 5 years of underperforming peers. He agrees with her.

BUY

Allan Tong’s Discover Picks Analysts such as Jim Cramer would buy Pepsi stock now as the number of Covid cases could rise as the weather turns colder and more people stay at home to snack. Analysts expects its EPS to reach $1.50, which would return to last year’s levels. Pepsi pays a dividend just under 3%. The trailing PE has ballooned from 15.62x last December to the current 26.85x, which will give some investors pause. Read PEP and NVDA: 3 More Top Recognized ESG Investing Options for our full analysis.

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