Royal Bank Of Canada Issues Pessimistic Forecast for PepsiCo (NASDAQ:PEP) Stock Price

Key Points

• Royal Bank of Canada cut PepsiCo’s price target from $161 to $150 while maintaining a “sector perform” rating, implying about 19.4% upside from the stock’s current price.
• Analyst sentiment has weakened broadly: PepsiCo’s consensus rating is “Hold,” with 14 Holds, five Buys and one Sell, and a consensus price target of $150.20 after several brokerages reduced their targets or ratings.
• PepsiCo shares opened at $125.65, near their 12-month low of $124.21, despite the company beating its latest earnings and revenue estimates; investors remain focused on upcoming results, demand and margin concerns, and a Gatorade recall.

PepsiCo (NASDAQ:PEP - Get Free Report) had its target price dropped by stock analysts at Royal Bank Of Canada from $161.00 to $150.00 in a report released on Tuesday, Benzinga reports. The brokerage presently has a "sector perform" rating on the stock. Royal Bank Of Canada's price target would indicate a potential upside of 19.38% from the stock's current price.

Several other brokerages also recently commented on PEP. UBS Group dropped their target price on shares of PepsiCo from $159.00 to $145.00 and set a "buy" rating on the stock in a report on Friday. BNP Paribas Exane lowered their price target on PepsiCo from $183.00 to $161.00 and set an "outperform" rating on the stock in a research report on Wednesday, September 23rd. Weiss Ratings lowered PepsiCo from a "hold (c)" rating to a "hold (c-)" rating in a research note on Thursday, September 24th. TD Cowen decreased their target price on PepsiCo from $145.00 to $133.00 and set a "hold" rating for the company in a research note on Monday, September 28th. Finally, JPMorgan Chase & Co. lowered PepsiCo from an "overweight" rating to a "neutral" rating and lowered their target price for the company from $170.00 to $138.00 in a report on Tuesday, September 29th. Five investment analysts have rated the stock with a Buy rating, fourteen have issued a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat.com, PepsiCo presently has an average rating of "Hold" and a consensus price target of $150.20.

PepsiCo Stock Down 0.2%

PEP opened at $125.65 on Tuesday. The firm has a market cap of $171.50 billion, a P/E ratio of 16.47, a price-to-earnings-growth ratio of 2.86 and a beta of 0.35. The company has a debt-to-equity ratio of 1.91, a quick ratio of 0.74 and a current ratio of 0.93. The business has a 50 day moving average price of $136.72 and a 200 day moving average price of $143.72. PepsiCo has a twelve month low of $124.21 and a twelve month high of $171.48.

PepsiCo (NASDAQ:PEP - Get Free Report) last announced its quarterly earnings results on Thursday, July 9th. The company reported $2.20 EPS for the quarter, beating the consensus estimate of $2.19 by $0.01. PepsiCo had a return on equity of 54.63% and a net margin of 10.78%.The company had revenue of $24.18 billion for the quarter, compared to the consensus estimate of $23.95 billion. During the same quarter last year, the company posted $0.92 earnings per share. The company's revenue for the quarter was up 6.4% compared to the same quarter last year. PepsiCo has set its FY 2026 guidance at 8.550-8.710 EPS. Research analysts forecast that PepsiCo will post 8.56 EPS for the current year.

Insider Activity

In other news, EVP David Flavell sold 2,900 shares of the business's stock in a transaction that occurred on Monday, July 27th. The stock was sold at an average price of $139.54, for a total transaction of $404,666.00. Following the sale, the executive vice president directly owned 74,825 shares in the company, valued at approximately $10,441,080.50. The trade was a 3.73% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is accessible through the SEC website. Corporate insiders own 0.12% of the company's stock.

Institutional Trading of PepsiCo

Several institutional investors have recently made changes to their positions in PEP. Auto Owners Insurance Co grew its holdings in shares of PepsiCo by 14,857.8% in the 4th quarter. Auto Owners Insurance Co now owns 49,252,907 shares of the company's stock worth $7,068,777,000 after purchasing an additional 48,923,629 shares during the last quarter. Bank of America Corp DE bought a new position in PepsiCo during the 2nd quarter valued at about $2,755,509,000. Legal & General Group Plc bought a new position in PepsiCo during the 2nd quarter valued at about $1,200,274,000. Corient Private Wealth LP acquired a new position in PepsiCo in the second quarter valued at about $297,116,000. Finally, Canada Pension Plan Investment Board bought a new stake in PepsiCo during the second quarter worth about $487,558,000. 73.07% of the stock is currently owned by institutional investors and hedge funds.

PepsiCo News Summary

Here are the key news stories impacting PepsiCo this week:

• Positive Sentiment: Some analysts see signs that PepsiCo’s turnaround is gaining momentum, supported by international growth, potential operating improvements and expectations for revenue growth in the upcoming quarter. PepsiCo: Turnaround Accelerates Ahead Of Earnings
• Positive Sentiment: PepsiCo’s planned sale of bottling operations in Georgia and Armenia to Carlsberg could streamline the portfolio and provide evidence of broader strategic repositioning. Carlsberg agrees to buy PepsiCo bottlers
• Neutral Sentiment: PEP is one of several major consumer companies reporting this week, making Thursday’s earnings release the primary near-term catalyst. Options markets imply an approximately 3.75% post-earnings move, while broader estimates suggest a potential multibillion-dollar change in market value. PepsiCo Q3 Earnings Options Move
• Negative Sentiment: PepsiCo is recalling about 122,000 cases of Gatorade sold in dozens of states because of undeclared dyes. The recall adds regulatory, cost and reputational risk to the beverage business. PepsiCo recalls Gatorade cases
• Negative Sentiment: Wells Fargo cut its price target from $140 to $135 and kept an equal-weight rating, while JPMorgan downgraded PepsiCo to neutral. The revisions reflect concerns about limited upside and weaker fundamentals. PepsiCo price target lowered
• Negative Sentiment: Investors are concerned about Frito-Lay sales, North American demand and margins. Analysts also view Coca-Cola more favorably because of stronger Diet Coke momentum, while GLP-1 weight-loss drugs and competition from brands such as OLIPOP may weigh on PepsiCo’s snacks and beverages. Why Wall Street is choosing Coca-Cola over PepsiCo

PepsiCo Company Profile

PepsiCo, Inc NASDAQ: PEP is a global food and beverage company that develops, manufactures, markets and distributes a broad portfolio of snacks, drinks and convenient foods. Its beverage brands include Pepsi, Mountain Dew, Gatorade, 7UP in select markets, and bubly, while its food and snack brands include Lay's, Doritos, Cheetos, Tostitos, Fritos, Quaker and Ruffles.

The company's operations include beverage production and distribution, snack foods, convenient meals and nutrition-oriented products.

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