PepsiCo (PEP) Receives Sell Rating from Zacks Investment Research
Zacks Investment Research restated their sell rating on shares of PepsiCo (NASDAQ:PEP) in a report released on Wednesday morning.
According to Zacks, “PepsiCo is witnessing strained margins for quite some time due to operating and commodity cost inflation, including higher transportation costs and stepped-up advertising expense. This trend is likely to continue through the rest of 2018. Additionally, consumers’ awareness on health and wellness, alongside new taxes on sugar-sweetened beverages and growing regulatory pressures are affecting CSD sales, which has caused sluggishness in beverage category. Further, unfavorable foreign exchange rates due to the recent strengthening of the U.S. dollar are likely to hurt the company’s top and bottom lines in 2018. Consequently, the company trimmed adjusted earnings view for 2018. However, PepsiCo surpassed the industry in the past three months driven by earnings and sales beat in third-quarter 2018. Earnings topped estimates in the last 11 quarters, while it delivered positive sales surprise in five of the last seven quarters.”
Several other research analysts have also recently weighed in on the stock. BidaskClub cut shares of PepsiCo from a buy rating to a hold rating in a report on Friday, November 2nd. Deutsche Bank lowered their price target on shares of PepsiCo from $118.00 to $116.00 and set a hold rating on the stock in a report on Wednesday, October 3rd. Morgan Stanley lowered their price target on shares of PepsiCo from $127.00 to $125.00 and set a buy rating on the stock in a report on Thursday, October 4th. Citigroup lowered their price target on shares of PepsiCo from $118.00 to $116.00 and set a hold rating on the stock in a report on Wednesday, October 3rd. Finally, SunTrust Banks increased their price target on shares of PepsiCo to $110.00 and gave the company a hold rating in a report on Tuesday, July 24th. Two investment analysts have rated the stock with a sell rating, thirteen have issued a hold rating and six have given a buy rating to the stock. PepsiCo has a consensus rating of Hold and an average target price of $117.89.
PepsiCo (NASDAQ:PEP) last issued its earnings results on Tuesday, October 2nd. The company reported $1.59 earnings per share (EPS) for the quarter, beating the Zacks’ consensus estimate of $1.57 by $0.02. The company had revenue of $16.49 billion for the quarter, compared to analysts’ expectations of $16.38 billion. PepsiCo had a net margin of 7.66% and a return on equity of 73.27%. PepsiCo’s quarterly revenue was up 1.5% compared to the same quarter last year. During the same period in the prior year, the firm earned $1.48 EPS. As a group, sell-side analysts expect that PepsiCo will post 5.65 earnings per share for the current year.
The business also recently announced a quarterly dividend, which will be paid on Monday, January 7th. Shareholders of record on Friday, December 7th will be given a $0.9275 dividend. This represents a $3.71 dividend on an annualized basis and a yield of 3.18%. PepsiCo’s dividend payout ratio is currently 70.94%.
In other news, EVP David Yawman sold 12,024 shares of the firm’s stock in a transaction on Tuesday, October 16th. The shares were sold at an average price of $106.99, for a total transaction of $1,286,447.76. Following the completion of the transaction, the executive vice president now owns 59,133 shares of the company’s stock, valued at $6,326,639.67. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, CEO Mike Spanos sold 20,074 shares of the firm’s stock in a transaction on Wednesday, October 31st. The shares were sold at an average price of $112.42, for a total transaction of $2,256,719.08. Following the transaction, the chief executive officer now directly owns 35,520 shares of the company’s stock, valued at approximately $3,993,158.40. The disclosure for this sale can be found here. Insiders have sold 205,893 shares of company stock valued at $22,663,157 in the last ninety days. Insiders own 0.27% of the company’s stock.
Hedge funds and other institutional investors have recently made changes to their positions in the stock. Fiera Capital Corp raised its stake in PepsiCo by 5.3% during the first quarter. Fiera Capital Corp now owns 3,512,114 shares of the company’s stock worth $383,347,000 after buying an additional 177,748 shares during the last quarter. Buckingham Capital Management Inc. raised its stake in PepsiCo by 5.6% during the second quarter. Buckingham Capital Management Inc. now owns 31,907 shares of the company’s stock worth $3,474,000 after buying an additional 1,689 shares during the last quarter. Patriot Wealth Management Inc. raised its stake in PepsiCo by 3.1% during the second quarter. Patriot Wealth Management Inc. now owns 43,785 shares of the company’s stock worth $4,767,000 after buying an additional 1,297 shares during the last quarter. Ausdal Financial Partners Inc. raised its stake in PepsiCo by 8.1% during the second quarter. Ausdal Financial Partners Inc. now owns 8,903 shares of the company’s stock worth $969,000 after buying an additional 664 shares during the last quarter. Finally, World Asset Management Inc raised its stake in PepsiCo by 2.9% during the second quarter. World Asset Management Inc now owns 102,760 shares of the company’s stock worth $11,187,000 after buying an additional 2,917 shares during the last quarter. 70.39% of the stock is owned by institutional investors and hedge funds.
PepsiCo Company Profile
PepsiCo, Inc operates as a food and beverage company worldwide. Its Frito-Lay North America segment offers Lay's and Ruffles potato chips; Doritos, Tostitos, and Santitas tortilla chips; and Cheetos snacks, branded dips, and Fritos corn chips. The company's Quaker Foods North America segment provides cereals, rice, pasta, mixes and syrups, granola bars, grits, oat squares, oatmeal, rice cakes, simply granola, and side dishes under the brands Quaker, Aunt Jemima, Cap'n crunch, life, Quaker Chewy, and Rice-A-Roni.
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