Pepsico, Inc. (PEP) Cut to “Hold” at Zacks Investment Research
Zacks Investment Research lowered shares of Pepsico, Inc. (NYSE:PEP) from a buy rating to a hold rating in a report published on Monday.
According to Zacks, “PepsiCo’s shares outperformed the industry to which it belongs in the past 12 months. The company 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, it has been seeing higher volumes and profits in the North American segments due to an improving economy, better industry pricing dynamics and a consistency in positive innovation. 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 3% volume decline in the first half of 2017 in North America. Again, rising volatility in global markets and increasing currency headwinds may dampen growth.”
A number of other equities research analysts also recently weighed in on the stock. Jefferies Group LLC reiterated a buy rating and set a $127.00 price target on shares of Pepsico in a research note on Friday, May 19th. Vetr upgraded shares of Pepsico from a buy rating to a strong-buy rating and set a $125.54 price target on the stock in a research note on Wednesday, May 3rd. Susquehanna Bancshares Inc reiterated a positive rating and set a $134.00 price target (up previously from $132.00) on shares of Pepsico in a research note on Monday, May 1st. Cowen and Company reiterated an outperform rating and set a $128.00 price target on shares of Pepsico in a research note on Thursday, July 13th. Finally, J P Morgan Chase & Co reiterated an overweight rating on shares of Pepsico in a research note on Wednesday, July 12th. Five research analysts have rated the stock with a hold rating, thirteen have issued a buy rating and one has given a strong buy rating to the company. The company presently has an average rating of Buy and a consensus price target of $123.40.
Shares of Pepsico (NYSE PEP) opened at 115.15 on Monday. The company’s 50-day moving average is $116.38 and its 200 day moving average is $113.78. Pepsico has a 52 week low of $98.50 and a 52 week high of $119.39. The firm has a market capitalization of $164.15 billion, a price-to-earnings ratio of 24.39 and a beta of 0.67. Pepsico also was the recipient of unusually large options trading activity on Wednesday. Traders acquired 1,176 call options on the company. This represents an increase of approximately 536% compared to the typical daily volume of 185 call options.
Pepsico (NYSE:PEP) last posted its quarterly earnings results on Tuesday, July 11th. The company reported $1.50 earnings per share for the quarter, topping the Zacks’ consensus estimate of $1.40 by $0.10. Pepsico had a net margin of 10.77% and a return on equity of 59.74%. The firm had revenue of $15.71 billion for the quarter, compared to the consensus estimate of $15.57 billion. During the same quarter in the previous year, the company earned $1.35 earnings per share. The business’s revenue was up 2.0% compared to the same quarter last year. Analysts anticipate that Pepsico will post $5.15 EPS for the current fiscal year.
The firm also recently declared a quarterly dividend, which will be paid on Friday, September 29th. Investors of record on Friday, September 1st will be issued a $0.805 dividend. The ex-dividend date of this dividend is Wednesday, August 30th. This represents a $3.22 dividend on an annualized basis and a dividend yield of 2.80%. Pepsico’s dividend payout ratio is 68.22%.
In related news, EVP Mehmood Khan sold 63,396 shares of Pepsico stock in a transaction dated Monday, July 24th. The stock was sold at an average price of $116.39, for a total value of $7,378,660.44. Following the completion of the transaction, the executive vice president now directly owns 174,273 shares of the company’s stock, valued at $20,283,634.47. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Also, SVP Marie T. Gallagher sold 41,489 shares of Pepsico stock in a transaction dated Monday, August 7th. The shares were sold at an average price of $116.77, for a total value of $4,844,670.53. Following the completion of the transaction, the senior vice president now directly owns 76,037 shares of the company’s stock, valued at $8,878,840.49. The disclosure for this sale can be found here. Insiders sold 898,164 shares of company stock valued at $104,585,929 over the last ninety days. 0.26% of the stock is currently owned by company insiders.
Hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. Russell Investments Group Ltd. boosted its position in Pepsico by 14.6% in the first quarter. Russell Investments Group Ltd. now owns 3,881,793 shares of the company’s stock worth $434,310,000 after buying an additional 495,542 shares in the last quarter. QV Investors Inc. boosted its position in Pepsico by 18.4% in the first quarter. QV Investors Inc. now owns 37,420 shares of the company’s stock worth $4,185,000 after buying an additional 5,810 shares in the last quarter. Taylor Cottrill Erickson & Associates Inc. boosted its position in Pepsico by 3.6% in the first quarter. Taylor Cottrill Erickson & Associates Inc. now owns 5,222 shares of the company’s stock worth $584,000 after buying an additional 183 shares in the last quarter. Wsfs Capital Management LLC acquired a new position in Pepsico during the fourth quarter worth about $203,000. Finally, Highbridge Capital Management LLC boosted its position in Pepsico by 563.2% in the fourth quarter. Highbridge Capital Management LLC now owns 20,846 shares of the company’s stock worth $2,182,000 after buying an additional 25,346 shares in the last quarter. 70.15% of the stock is owned by institutional investors and hedge funds.
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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