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PepsiCo (PEP) Stock Sinks As Market Gains: What You Should Know

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PepsiCo (PEP - Free Report) closed the most recent trading day at $155.20, moving -0.44% from the previous trading session. This change lagged the S&P 500's daily gain of 0.22%.

Coming into today, shares of the food and beverage company had lost 1.3% in the past month. In that same time, the Consumer Staples sector lost 0.73%, while the S&P 500 gained 1.86%.

PEP will be looking to display strength as it nears its next earnings release, which is expected to be October 5, 2021. In that report, analysts expect PEP to post earnings of $1.72 per share. This would mark year-over-year growth of 3.61%. Meanwhile, our latest consensus estimate is calling for revenue of $19.37 billion, up 7.1% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $6.24 per share and revenue of $77.27 billion, which would represent changes of +13.04% and +9.8%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for PEP. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 0.01% higher within the past month. PEP currently has a Zacks Rank of #3 (Hold).

Digging into valuation, PEP currently has a Forward P/E ratio of 25. This represents a premium compared to its industry's average Forward P/E of 24.19.

Also, we should mention that PEP has a PEG ratio of 2.97. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Beverages - Soft drinks industry currently had an average PEG ratio of 2.49 as of yesterday's close.

The Beverages - Soft drinks industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 214, putting it in the bottom 16% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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