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

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PepsiCo (PEP - Free Report) closed at $174.08 in the latest trading session, marking a +0.13% move from the prior day. This change outpaced the S&P 500's 0.41% loss on the day. Elsewhere, the Dow lost 0.01%, while the tech-heavy Nasdaq added 0.13%.

Heading into today, shares of the food and beverage company had gained 4.54% over the past month, lagging the Consumer Staples sector's gain of 5.83% and outpacing the S&P 500's gain of 2.36% in that time.

PepsiCo will be looking to display strength as it nears its next earnings release, which is expected to be February 10, 2022. The company is expected to report EPS of $1.52, up 3.4% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $24.32 billion, up 8.29% from the year-ago period.

Any recent changes to analyst estimates for PepsiCo should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

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.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. PepsiCo is currently a Zacks Rank #3 (Hold).

Digging into valuation, PepsiCo currently has a Forward P/E ratio of 25.79. This valuation marks a premium compared to its industry's average Forward P/E of 22.11.

Also, we should mention that PEP has a PEG ratio of 3.05. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Beverages - Soft drinks was holding an average PEG ratio of 2.35 at yesterday's closing price.

The Beverages - Soft drinks industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 210, putting it in the bottom 18% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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.

To follow PEP in the coming trading sessions, be sure to utilize Zacks.com.


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