Why is Pepsi a good stock?
The company simply performs well, year in and year out. For this reason, there's likely little downside for those who buy PepsiCo stock today. And this low downside risk is a good reason to hold on to shares. Investors are unlikely to lose money with a company such as this.
PepsiCo is also cash rich. The company has generated cash flow growth of 6.1%, and is expected to report cash flow expansion of 10.6% in 2024. PEP should be on investors' short lists because of its impressive growth fundamentals, a good Zacks Rank, and strong Growth and VGM Style Scores.
PepsiCo Inc. posted stronger-than-expected sales growth thanks to robust demand in its international divisions, while volumes dropped in North America.
PepsiCo, Inc.
In 2023, 61% of sales came from North America, with the rest of PepsiCo's revenues coming from all over the world. The stock has returned in a stable manner, appreciating at a CAGR of 7.7% within the past ten years.
In addition to being a Dividend King, PepsiCo (PEP -0.27%) has a yield of 3.3% at its current share price -- high relative to the average yield of 1.3% for the S&P 500.
In our test, Pepsi got more votes thanks to how darn refreshing this soft drink is. It's sweet, of course, but it's also got a little something extra. Pepsi has a slight citrusy tang that makes it taste crisp and delicious.
PepsiCo's competitive advantage lies in its global leadership in the beverage and convenient food industry, strategic SWOT analysis, strong financial performance, and projected revenue growth potential.
Overall, Pepsi's success can be attributed to its ability to adapt to changing consumer preferences, innovate, and expand its business through strategic acquisitions and global expansion.
Pepsi has experimented with unique flavors like "Crystal Pepsi," "Pepsi Blue," and various limited-edition options, catering to changing consumer tastes. In 1975, Pepsi became the first American consumer product to be produced, marketed, and sold in the Soviet Union.
According to PepsiCo's most recent annual report, the company generated net revenue of around 86 billion U.S. dollars worldwide in 2022. In the same year, the company recorded almost nine billion dollars in net income.
How is Pepsi doing financially?
PepsiCo revenue for the quarter ending March 31, 2024 was $18.250B, a 2.26% increase year-over-year. PepsiCo revenue for the twelve months ending March 31, 2024 was $91.875B, a 4.36% increase year-over-year. PepsiCo annual revenue for 2023 was $91.471B, a 5.88% increase from 2022.
The stock has been under pressure since last fall as investors have worried about whether consumer spending will hold up despite inflation and higher interest rates. The rise of weight-loss drugs that could hit demand for snack foods and sugary drinks is another difficulty.
Total debt on the balance sheet as of March 2024 : $45.86 B
According to Pepsico's latest financial reports the company's total debt is $45.86 B. A company's total debt is the sum of all current and non-current debts.
It's true that investors often want to outperform the S&P 500. However, there can be other legitimately good reasons for buying PepsiCo stock. For starters, the company pays a very reliable quarterly dividend, and the dividend yield is high at over 3%. That's one of the highest yields it's had in the past decade.
The company serves customers in more than 200 countries and territories. PEP is a #3 (Hold) on the Zacks Rank, with a VGM Score of B. Additionally, the company could be a top pick for growth investors. PEP has a Growth Style Score of A, forecasting year-over-year earnings growth of 7% for the current fiscal year.
The intrinsic value of one PEP stock under the Base Case scenario is 175.78 USD. Compared to the current market price of 164.93 USD, PepsiCo Inc is Undervalued by 6%.
1. The stock is cheaper. Even after outperforming KO stock in recent years, its price-to-earnings ratio is still slightly cheaper than co*ke's. On a price-to-sales basis, Pepsi (2.6) is markedly cheaper than co*ke (6.0).
Pepsi Special is a cola flavored soft drink offered in Japan from PepsiCo that contains Dextrin. Suntory, the manufacturer of the beverage claims that the dextrin in the drink suppresses the absorption of fat.
The company is failing to meet the demand of the market. This untapped market is one of its most significant weaknesses. The brand needs more acquisition that will help them to expand their business. The company's niche marketing and products are also one of its weaknesses.
- Pros.
- Diversified portfolio. Pepsi has a broad range of products for beverages and snack foods, which are sold in more than 200 countries. ...
- Consumer savvy. ...
- Emerging markets. ...
- Cons.
- Competitive pressures. ...
- Macro issues. ...
- Junk food problem.
What benefits does Pepsi have?
Consuming a variety of soft drinks, especially those high in sugar and caffeine like Pepsi and co*ke, on a daily basis can have several negative impacts on health. 1> Weight gain: Regular consumption of sugary sodas can contribute to weight gain and obesity due to their high calorie content.
Overall, PepsiCo's success can be attributed to a combination of factors, including its diversified product portfolio, strong brand recognition, global presence, innovative marketing strategies, strategic acquisitions, sustainability efforts, collaborations and partnerships, strong distribution network and investment ...
“Pepsi is sweeter than co*ke,” writes Malcolm Gladwell in his book Blink. He goes on, “Pepsi is also characterized by a citrusy flavor burst, unlike the more raisiny-vanilla taste of co*ke.” Those observations are in line with the ingredients. Pepsi contains citric acid, while co*ke does not.
In 1893, Bradham began selling “Brad's Drink” at the soda fountain in his store. The beverage was a mixture of sugar, water, caramel, lemon oil, nutmeg, kola nuts, and a few other ingredients. Five years later, Bradham renamed the drink Pepsi Cola because he believed that it helped to stave off dyspepsia (indigestion).
