North Star Asset Management Inc. Reduces Holdings in PepsiCo, Inc. $PEP

Key Points

• North Star Asset Management reduced its PepsiCo stake by 13.6% in the fourth quarter, selling 9,037 shares and leaving it with 57,640 shares worth about $8.27 million.
• Wall Street remains cautious on PepsiCo overall, with a consensus “Hold” rating and an average price target of $170.11, even though several analysts recently nudged targets higher or maintained bullish ratings.
• PepsiCo recently reported better-than-expected quarterly results, raised its dividend to $1.48 per share, and authorized a $10 billion share buyback, while cost pressures and planned price increases remain key headwinds.

North Star Asset Management Inc. trimmed its stake in PepsiCo, Inc. (NASDAQ:PEP - Free Report) by 13.6% during the fourth quarter, according to its most recent 13F filing with the Securities and Exchange Commission (SEC). The fund owned 57,640 shares of the company's stock after selling 9,037 shares during the period. North Star Asset Management Inc.'s holdings in PepsiCo were worth $8,273,000 at the end of the most recent quarter.

A number of other hedge funds have also recently modified their holdings of the stock. United Bank grew its position in shares of PepsiCo by 3.9% in the 4th quarter. United Bank now owns 1,717 shares of the company's stock valued at $246,000 after buying an additional 65 shares during the last quarter. Koa Wealth Management LLC grew its position in shares of PepsiCo by 0.9% in the 4th quarter. Koa Wealth Management LLC now owns 8,007 shares of the company's stock valued at $1,149,000 after buying an additional 68 shares during the last quarter. Facet Wealth Inc. grew its position in shares of PepsiCo by 3.2% in the 3rd quarter. Facet Wealth Inc. now owns 2,221 shares of the company's stock valued at $312,000 after buying an additional 69 shares during the last quarter. Delta Asset Management LLC TN grew its position in shares of PepsiCo by 0.6% in the 3rd quarter. Delta Asset Management LLC TN now owns 11,000 shares of the company's stock valued at $1,545,000 after buying an additional 70 shares during the last quarter. Finally, Westside Investment Management Inc. grew its position in shares of PepsiCo by 2.8% in the 3rd quarter. Westside Investment Management Inc. now owns 2,602 shares of the company's stock valued at $366,000 after buying an additional 70 shares during the last quarter. 73.07% of the stock is owned by hedge funds and other institutional investors.

Wall Street Analyst Weigh In

Several research analysts have issued reports on PEP shares. Weiss Ratings reissued a "hold (c)" rating on shares of PepsiCo in a research report on Wednesday, April 8th. Argus raised shares of PepsiCo to a "hold" rating in a research report on Tuesday, February 17th. Wells Fargo & Company lowered their price objective on shares of PepsiCo from $165.00 to $160.00 and set an "equal weight" rating on the stock in a research report on Monday, May 18th. TD Cowen raised their price objective on shares of PepsiCo from $162.00 to $165.00 and gave the stock a "hold" rating in a research report on Friday, February 20th. Finally, Piper Sandler raised their price objective on shares of PepsiCo from $172.00 to $181.00 and gave the stock an "overweight" rating in a research report on Thursday, March 12th. 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. Based on data from MarketBeat, PepsiCo has a consensus rating of "Hold" and an average target price of $170.11.

Key PepsiCo News

Here are the key news stories impacting PepsiCo this week:

• Positive Sentiment: PepsiCo extended and revised its licensing and bottling arrangements with Varun Beverages in India through 2049, while also giving the partner more freedom to pursue non-PepsiCo ventures. The longer-term deal should help protect distribution in a key growth market and reduce partnership uncertainty. Varun Beverages, PepsiCo revise licencing deal
• Positive Sentiment: PepsiCo is also being highlighted by market commentary as a strong growth stock and a defensive blue-chip income name, reinforcing investor interest in the company’s earnings stability and dividend profile. Here's Why PepsiCo (PEP) is a Strong Growth Stock
• Neutral Sentiment: PepsiCo launched new products and initiatives, including a functional ready-to-drink tea and a greenhouse program in Asia-Pacific, which support its innovation story but are unlikely to move the stock on their own. PepsiCo adds functional RTD tea
• Neutral Sentiment: The company is also moving ahead with sustainability and regenerative agriculture efforts, which may help long-term brand positioning but are not immediate earnings catalysts. PepsiCo enters regen ag pact with LDC
• Negative Sentiment: Industry coverage continues to flag margin pressure from higher sugar, packaging and freight costs, along with tariff uncertainty. That backdrop could weigh on profitability for PepsiCo and other soft drink makers if costs stay elevated. 5 Soft Drinks Stocks to Track Amid Margin & Tariff Pressures
• Negative Sentiment: PepsiCo said it will raise prices on some smaller chip bags to offset increased costs. While this may help margins, it can also pressure volume and suggests inflation remains a headwind. Lay’s and Doritos maker to raise prices on small bags of chips

PepsiCo Stock Up 1.2%

PEP stock opened at $150.57 on Friday. PepsiCo, Inc. has a one year low of $127.60 and a one year high of $171.48. The stock has a market capitalization of $205.79 billion, a PE ratio of 23.64, a price-to-earnings-growth ratio of 2.73 and a beta of 0.38. 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 company has a fifty day moving average of $154.17 and a 200-day moving average of $152.45.

PepsiCo (NASDAQ:PEP - Get Free Report) last released its earnings results on Wednesday, April 15th. The company reported $1.61 EPS for the quarter, topping the consensus estimate of $1.55 by $0.06. PepsiCo had a net margin of 9.15% and a return on equity of 56.61%. The company had revenue of $19.44 billion during the quarter, compared to analysts' expectations of $18.89 billion. During the same quarter last year, the business earned $1.48 EPS. The business's revenue was up 8.5% on a year-over-year basis. As a group, analysts expect that PepsiCo, Inc. will post 8.63 EPS for the current year.

PepsiCo Increases Dividend

The company 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 $1.48 dividend. This is a boost from PepsiCo's previous quarterly dividend of $1.42. The ex-dividend date is Friday, June 5th. This represents a $5.92 annualized dividend and a dividend yield of 3.9%. PepsiCo's dividend payout ratio (DPR) is 89.32%.

PepsiCo announced that its Board of Directors has approved a stock repurchase program on Tuesday, February 3rd that authorizes the company to buyback $10.00 billion in outstanding shares. This buyback authorization authorizes the company to purchase up to 4.7% of its stock through open market purchases. Stock buyback programs are generally a sign that the company's board believes its shares are undervalued.

PepsiCo 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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