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PepsiCo (PEP) Dips More Than Broader Market: What You Should Know

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In the latest market close, PepsiCo (PEP - Free Report) reached $167, with a -0.74% movement compared to the previous day. The stock's performance was behind the S&P 500's daily loss of 0.01%. Elsewhere, the Dow saw an upswing of 0.15%, while the tech-heavy Nasdaq appreciated by 0.36%.

The the stock of food and beverage company has risen by 0.32% in the past month, lagging the Consumer Staples sector's gain of 2.74% and the S&P 500's gain of 5.21%.

Investors will be eagerly watching for the performance of PepsiCo in its upcoming earnings disclosure. On that day, PepsiCo is projected to report earnings of $1.72 per share, which would represent year-over-year growth of 2.99%. Our most recent consensus estimate is calling for quarterly revenue of $28.26 billion, up 0.93% from the year-ago period.

For the full year, the Zacks Consensus Estimates are projecting earnings of $7.55 per share and revenue of $91.88 billion, which would represent changes of +11.19% and +6.35%, respectively, from the prior year.

Any recent changes to analyst estimates for PepsiCo should also be noted by investors. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. PepsiCo is holding a Zacks Rank of #2 (Buy) right now.

Looking at its valuation, PepsiCo is holding a Forward P/E ratio of 22.29. This denotes a premium relative to the industry's average Forward P/E of 20.05.

Investors should also note that PEP has a PEG ratio of 2.69 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. As the market closed yesterday, the Beverages - Soft drinks industry was having an average PEG ratio of 2.35.

The Beverages - Soft drinks industry is part of the Consumer Staples sector. This industry currently has a Zacks Industry Rank of 25, which puts it in the top 10% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.


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