Callahan Advisors LLC Has $18.70 Million Stake in PepsiCo, Inc. $PEP

Key Points

• Callahan Advisors LLC trimmed its PepsiCo stake by 5.5% in the fourth quarter, selling 7,622 shares and ending with 130,291 shares valued at about $18.7 million.
• PepsiCo posted stronger-than-expected quarterly results, with EPS of $1.61 beating estimates and revenue of $19.44 billion topping forecasts, while revenue rose 8.5% year over year.
• The company also raised its quarterly dividend to $1.48 per share and authorized a $10 billion stock repurchase program, but analysts remain mixed with an overall Hold rating and average target price near $170.

Callahan Advisors LLC decreased its holdings in shares of PepsiCo, Inc. (NASDAQ:PEP - Free Report) by 5.5% in the 4th quarter, according to its most recent disclosure with the Securities and Exchange Commission. The fund owned 130,291 shares of the company's stock after selling 7,622 shares during the quarter. PepsiCo makes up about 1.5% of Callahan Advisors LLC's investment portfolio, making the stock its 21st biggest holding. Callahan Advisors LLC's holdings in PepsiCo were worth $18,699,000 at the end of the most recent quarter.

Several other large investors have also added to or reduced their stakes in PEP. MH & Associates Securities Management Corp ADV acquired a new position in PepsiCo during the fourth quarter worth $29,000. Imprint Wealth LLC acquired a new stake in PepsiCo in the third quarter valued at $31,000. Strategic Advocates LLC acquired a new stake in PepsiCo in the third quarter valued at $33,000. Mowery & Schoenfeld Wealth Management LLC acquired a new stake in PepsiCo in the fourth quarter valued at $33,000. Finally, Highline Wealth Partners LLC lifted its stake in PepsiCo by 56.3% in the fourth quarter. Highline Wealth Partners LLC now owns 250 shares of the company's stock valued at $36,000 after acquiring an additional 90 shares during the last quarter. Institutional investors and hedge funds own 73.07% of the company's stock.

PepsiCo Stock Performance

NASDAQ PEP opened at $149.29 on Thursday. The firm has a 50-day moving average of $154.60 and a 200-day moving average of $152.45. The company has a debt-to-equity ratio of 1.98, a quick ratio of 0.72 and a current ratio of 0.90. The stock has a market cap of $204.05 billion, a PE ratio of 23.44, a P/E/G ratio of 2.73 and a beta of 0.38. PepsiCo, Inc. has a 52-week low of $127.60 and a 52-week high of $171.48.

PepsiCo (NASDAQ:PEP - Get Free Report) last posted its earnings results on Wednesday, April 15th. The company reported $1.61 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $1.55 by $0.06. The company had revenue of $19.44 billion during the quarter, compared to analysts' expectations of $18.89 billion. PepsiCo had a net margin of 9.15% and a return on equity of 56.61%. PepsiCo's quarterly revenue was up 8.5% compared to the same quarter last year. During the same quarter last year, the company posted $1.48 EPS. On average, sell-side analysts anticipate that PepsiCo, Inc. will post 8.63 EPS for the current year.

PepsiCo announced that its Board of Directors has authorized a stock repurchase program on Tuesday, February 3rd that allows the company to repurchase $10.00 billion in shares. This repurchase authorization allows the company to buy up to 4.7% of its stock through open market purchases. Stock repurchase programs are often a sign that the company's leadership believes its shares are undervalued.

PepsiCo Increases Dividend

The business also recently announced a quarterly dividend, which will be paid on Tuesday, June 30th. Stockholders of record on Friday, June 5th will be paid a dividend of $1.48 per share. The ex-dividend date is Friday, June 5th. This represents a $5.92 dividend on an annualized basis and a dividend yield of 4.0%. This is a boost from PepsiCo's previous quarterly dividend of $1.42. PepsiCo's dividend payout ratio is 89.32%.

Key Headlines Impacting PepsiCo

Here are the key news stories impacting PepsiCo this week:

• Positive Sentiment: Analysts and market commentary continue to highlight PepsiCo’s portfolio reset, pricing power, and innovation in zero-sugar, functional, and “better-for-you” snacks and drinks as potential growth drivers. Article Title
• Positive Sentiment: PepsiCo India plans to invest Rs 5,700 crore through 2030 to expand capacity, which could support long-term growth in an important international market. Article Title
• Neutral Sentiment: At the annual meeting, shareholders elected David W. Gibbs to the board and rejected proposals for an independent board chair and additional human-rights and animal-welfare reporting, suggesting governance issues remain in focus but are not a major near-term catalyst. Article Title
• Neutral Sentiment: Commentary comparing PepsiCo with Coca-Cola underscores that PEP is working to balance pricing power and distribution scale against margin pressure from higher input and operating costs. Article Title
• Negative Sentiment: Multiple reports say PepsiCo plans to raise prices on some smaller chip bags because of higher production, distribution, and retail expenses in the U.S., which may raise concerns about volume softness if consumers push back. Article Title
• Negative Sentiment: Wells Fargo reportedly cut its price target on PepsiCo to $160, adding to the cautious tone around near-term margins and execution. Article Title

Analyst Ratings Changes

A number of brokerages have commented on PEP. JPMorgan Chase & Co. increased their price target on shares of PepsiCo from $172.00 to $178.00 and gave the company an "overweight" rating in a research note on Friday, April 17th. Wall Street Zen cut shares of PepsiCo from a "buy" rating to a "hold" rating in a research note on Saturday, April 18th. Citigroup increased their price target on shares of PepsiCo from $170.00 to $182.00 and gave the company a "buy" rating in a research note on Wednesday, February 4th. Barclays increased their price target on shares of PepsiCo from $154.00 to $158.00 and gave the company an "equal weight" rating in a research note on Monday, April 20th. Finally, Morgan Stanley increased their price target on shares of PepsiCo from $165.00 to $180.00 and gave the company an "equal weight" rating in a research note on Wednesday, February 4th. Eight research analysts have rated the stock with a Buy rating, ten have issued a Hold rating and one has given a Sell rating to the company's stock. According to MarketBeat.com, the company presently has an average rating of "Hold" and an average target price of $170.11.

PepsiCo Company Profile

PepsiCo, Inc NASDAQ: PEP is a multinational food and beverage company headquartered in Purchase, New York. The company develops, manufactures, markets and sells a broad portfolio of branded food and beverage products, including carbonated and noncarbonated soft drinks, bottled water, sports drinks, juices, ready-to-drink teas and coffees, salty snacks, cereals, and other convenient foods. Its leading consumer brands include Pepsi, Mountain Dew, Gatorade, Tropicana, Quaker, Lay's, Doritos and Cheetos, among others.

Formed through the 1965 merger of Pepsi-Cola and Frito-Lay, PepsiCo has grown into a global business with integrated manufacturing, distribution and marketing operations.

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