Zacks Investment Research Lowers PepsiCo Inc. (PEP) to Sell
PepsiCo Inc. (NYSE:PEP) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a research report issued on Thursday.
According to Zacks, “Soft CSD volumes is a pressing concern for Pepsi. Further, growing health awareness is hurting the CSD category, resulting in a 3% volume decline in the first half of 2016. Again, rising volatility in global markets and increasing currency headwind may dampen growth, going forward. That said, Pepsi has been doing well on the back of significant innovation, continued momentum in Frito-Lay business, revenue management strategies, improved productivity and better market execution. Moreover, Pepsi 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. We believe that Pepsi’ new product lineup, aggressive marketing efforts, productivity improvement and cost-saving initiatives should drive profits. Pepsi has rolled out several new products recently which management believes should drive sales and profits in the second half.”
PEP has been the topic of several other research reports. Credit Agricole SA reaffirmed an “outperform” rating on shares of PepsiCo in a report on Monday, August 22nd. Credit Suisse Group AG assumed coverage on shares of PepsiCo in a research report on Thursday, September 15th. They issued an “outperform” rating and a $121.00 target price for the company. Susquehanna reiterated a “neutral” rating on shares of PepsiCo in a research report on Tuesday, June 14th. Vetr lowered shares of PepsiCo from a “buy” rating to a “hold” rating and set a $104.63 target price for the company. in a research report on Wednesday, June 1st. Finally, Deutsche Bank AG upped their target price on shares of PepsiCo from $115.00 to $120.00 and gave the stock a “buy” rating in a research report on Friday, July 8th. One equities research analyst has rated the stock with a sell rating, ten have given a hold rating and fourteen have given a buy rating to the company. The stock presently has a consensus rating of “Buy” and a consensus price target of $110.96.
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PepsiCo (NYSE:PEP) traded up 0.359% on Thursday, hitting $107.515. The stock had a trading volume of 448,495 shares. The company has a market cap of $154.73 billion, a P/E ratio of 30.380 and a beta of 0.48. PepsiCo has a 52-week low of $91.45 and a 52-week high of $110.94. The stock’s 50-day moving average is $107.34 and its 200-day moving average is $104.79.
PepsiCo (NYSE:PEP) last released its quarterly earnings results on Thursday, July 7th. The company reported $1.35 earnings per share for the quarter, topping the consensus estimate of $1.30 by $0.05. The firm had revenue of $15.40 billion for the quarter. PepsiCo had a net margin of 8.34% and a return on equity of 54.91%. The company’s revenue for the quarter was down 3.3% compared to the same quarter last year. During the same period in the previous year, the company posted $1.32 EPS. Analysts expect that PepsiCo will post $4.76 earnings per share for the current year.
The firm also recently announced a quarterly dividend, which will be paid on Friday, September 30th. Shareholders of record on Friday, September 2nd will be paid a dividend of $0.7525 per share. This represents a $3.01 dividend on an annualized basis and a dividend yield of 2.81%. The ex-dividend date is Wednesday, August 31st. PepsiCo’s dividend payout ratio is 84.79%.
In other PepsiCo news, EVP Mehmood Khan sold 51,137 shares of the firm’s stock in a transaction that occurred on Thursday, July 28th. The shares were sold at an average price of $107.30, for a total transaction of $5,487,000.10. Following the completion of the transaction, the executive vice president now owns 164,464 shares of the company’s stock, valued at $17,646,987.20. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. Also, CEO Albert P. Carey sold 170,003 shares of the firm’s stock in a transaction that occurred on Tuesday, July 12th. The shares were sold at an average price of $108.81, for a total transaction of $18,498,026.43. Following the transaction, the chief executive officer now directly owns 306,138 shares of the company’s stock, valued at approximately $33,310,875.78. The disclosure for this sale can be found here. Company insiders own 0.33% of the company’s stock.
Several large investors have recently bought and sold shares of PEP. D. Scott Neal Inc. boosted its stake in PepsiCo by 8.1% in the second quarter. D. Scott Neal Inc. now owns 944 shares of the company’s stock worth $100,000 after buying an additional 71 shares during the last quarter. Piershale Financial Group Inc. boosted its stake in PepsiCo by 0.4% in the second quarter. Piershale Financial Group Inc. now owns 1,005 shares of the company’s stock worth $106,000 after buying an additional 4 shares during the last quarter. Delphi Private Advisors LLC boosted its stake in PepsiCo by 1.3% in the second quarter. Delphi Private Advisors LLC now owns 1,002 shares of the company’s stock worth $106,000 after buying an additional 13 shares during the last quarter. Global X Management Co. LLC boosted its stake in PepsiCo by 92.1% in the second quarter. Global X Management Co. LLC now owns 1,101 shares of the company’s stock worth $117,000 after buying an additional 528 shares during the last quarter. Finally, Stelac Advisory Services LLC boosted its stake in PepsiCo by 13.9% in the second quarter. Stelac Advisory Services LLC now owns 1,185 shares of the company’s stock worth $126,000 after buying an additional 145 shares during the last quarter. Hedge funds and other institutional investors own 69.81% of the company’s stock.
PepsiCo, Inc is a food and beverage company. The Company, through its operations, bottlers, contract manufacturers and other third parties, is engaged in making, marketing, distributing and selling a range of beverages, foods and snacks, serving in over 200 countries and territories. The Company operates through six segments, namely, Frito-Lay North America (FLNA); Quaker Foods North America (QFNA); North America Beverages (NAB); Latin America, which includes its beverage, food and snack businesses in Latin America; Europe Sub-Saharan Africa (ESSA), which includes its beverage, food and snack businesses in Europe and Sub-Saharan Africa, and Asia, Middle East and North Africa (AMENA), which includes its beverage, food and snack businesses in Asia, Middle East and North Africa.
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