Stock market sell-offs can be challenging for investors. Market volatility can make it tough to make new investments and keep the ones you already have due to the fear that they could lose value. However, I see sell-offs as opportunities to buy high-quality companies at lower valuations. I especially like to purchase top-notch dividend stocks during downturns, because dividend yields move in the opposite direction as stock prices. Because of that, I can lock in an even better income stream. One dividend sto ...

Core Viewpoint - PepsiCo's stock has declined approximately 15% over the past year, attributed to muted guidance and economic uncertainties [1] Financial Performance - In 2024, PepsiCo achieved a 2% increase in organic revenue and a record core EPS of $8.16, reflecting solid financial trends [3] - The company is guiding for low-single-digit organic revenue growth and mid-single-digit core EPS growth for 2025 [5] Market Position and Valuation - PepsiCo's stock is currently trading at its lowest valuation in five years, with a forward P/E ratio of 18, significantly below its average of 26 since 2020, indicating potential undervaluation [6] - The quarterly dividend payment of $1.36 per share yields 3.6%, the highest in a decade, supported by strong free cash flow [7] Geographic Diversification - Operations in Europe and Latin America have been growth drivers, balancing mixed results from North America [3] - Geographic diversification is crucial in the current market environment, especially with potential tariff disruptions [4] Consumer Trends and Challenges - There is a shift in consumer habits towards healthier and more affordable food options, which may impact demand for PepsiCo products [9] - The company has faced challenges with soft unit volume trends in its Frito-Lay and Quaker Foods divisions in North America [9][10] Investment Outlook - The current year is pivotal for PepsiCo to reaffirm its market potential and improve investor sentiment, presenting a buy-the-dip opportunity [11]

Financial Data and Key Metrics Changes - The company reported a low single-digit organic sales guidance for 2025, reflecting a cautious outlook amid global uncertainties [69][65] - The international business is expected to continue performing well, contributing significantly to overall results [69][118] Business Line Data and Key Metrics Changes - The Frito-Lay business is experiencing a slowdown after five years of rapid growth, with a focus on stabilizing the category and improving volume [46][75] - The beverage segment is seeing continuous margin improvement, with aspirations for mid-teens margins [43][44] Market Data and Key Metrics Changes - The North American market is expected to improve gradually throughout 2025, driven by innovation and a focus on away-from-home opportunities [68][65] - The international market, particularly Europe, has shown consistent volume growth despite pricing normalization, indicating a strong execution strategy [118][120] Company Strategy and Development Direction - The company is focusing on systematic productivity improvements, including automation and digitalization, to enhance operational efficiency [22][24] - Investments are being directed towards capturing away-from-home opportunities and developing new product offerings that align with consumer trends towards healthier options [15][90] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the economic environment, noting low unemployment and improving inflation, but highlighted the need for flexibility in investment strategies [24][25] - The company remains committed to long-term growth targets of 4% to 6%, with confidence in its plans to accelerate North American business [124][125] Other Important Information - The company is addressing consumer preferences for healthier options through innovations in portion control and functional snacks [60][109] - The acquisitions of Ciete and Sabra are seen as strategic moves to enhance the product portfolio and capture new market segments [111][90] Q&A Session Summary Question: Insights on Frito's reinvestment and volume deceleration - Management acknowledged the need to regain momentum in the Frito business and emphasized ongoing investments to improve performance [11][12] Question: Guidance on EPS and investment levels - Management indicated that productivity savings will remain robust, with a cautious approach to investments in light of global uncertainties [20][25] Question: Restructuring implications and M&A considerations - Management clarified that restructuring aims to enhance focus on beverage and food opportunities, with no immediate plans for further M&A [32][30] Question: North American business strategy adjustments - Management highlighted a focus on innovation and operational excellence to drive growth in both Frito-Lay and beverage segments [44][46] Question: Performance in Mexico and consumer environment - Management noted that the international business remains a significant growth opportunity, with ongoing investments to build scale [41][42] Question: Pricing strategy and consumer preferences - Management emphasized a surgical pricing strategy to provide consumers with options without diluting overall pricing [80][84] Question: Energy category growth and execution - Management reaffirmed the importance of the energy category in the beverage growth strategy, indicating no significant changes in approach [96][95] Question: Impact of GLP usage on salty snacks - Management stated that while they monitor GLP usage, they have not seen a direct impact on their business, focusing instead on evolving consumer health awareness [108][109] Question: Long-term organic sales guidance - Management expressed confidence in achieving long-term growth targets, citing strong international performance and strategic investments [124][125]

Core Viewpoint - PepsiCo, Inc. (PEP) is facing significant challenges, reflected in its stock performance and technical indicators, suggesting a bearish trend and investor caution [1][3][12]. Group 1: Stock Performance - PEP shares have decreased by 12.5% over the past year, underperforming the Zacks Beverages – Soft Drinks industry, which grew by 1.3% [3]. - The stock is currently trading at $149.94, below its 200-day simple moving average of $159.46, indicating a potential sustained downward trend [1][8]. - PEP's stock reflects an 18.2% discount from its 52-week high of $183.41 and a 6% premium over its 52-week low of $141.51 [9]. Group 2: Earnings Estimates - The Zacks Consensus Estimate for PEP's earnings per share (EPS) for 2025 and 2026 has been revised down by a penny in the last 30 days [10]. - For 2025, the sales estimate indicates a 0.1% decline, while EPS suggests a 1.6% year-over-year growth [10]. - The consensus for 2026 sales and earnings indicates growth of 3.5% and 6.4% year-over-year, respectively [10]. Group 3: Competitive Landscape - PEP's performance is weaker compared to competitors like The Coca-Cola Company (KO), Monster Beverage (MNST), and Keurig Dr Pepper Inc (KDP), which have growth rates of 19.1%, 2.9%, and 10.7%, respectively [4]. - PEP's forward 12-month P/E ratio is 17.8X, below the industry average of 18.89X and the S&P 500's average of 20.42X [16]. Group 4: Operational Challenges - The company is experiencing weak top-line performance due to challenges in its QFNA segment and the North American market, including product recalls and weak demand [12][13]. - In Q4 2024, revenues declined by 0.2% year-over-year, with unit volume down 1% in both convenient foods and beverage businesses [14]. - Ongoing product recalls and rising prices have pressured volumes, leading to investor skepticism [15][20].

It's not often that the stock market's cyclicality brings on value deals with the potential of making a life- changing return for investors, yet when those opportunities come about, they can be sure these will likely be short-lived as more capital starts to chase the diminishing opportunities of a value investment. Today, there are three names (big enough in the United States economy) that would fit this description for investors to consider. Representing, in part, the retail sector and directly tied to con ...

Group 1 - The core investment thesis for PepsiCo is its attractive 3.7% dividend yield, which is significantly higher than the average yield of 2.6% for consumer staples and 1.2% for the S&P 500, making it appealing for dividend investors [3][4] - PepsiCo's current dividend yield is at the high end of its historical range, indicating that the stock is historically undervalued based on traditional valuation metrics like price-to-sales and price-to-earnings ratios, which are below their five-year averages [4][5] - As a Dividend King, PepsiCo has a strong track record of 52 consecutive annual dividend increases, showcasing its commitment to returning value to shareholders [5] Group 2 - PepsiCo has a robust and diversified business model, being a leader in the salty snack food market and the second-largest beverage maker in the U.S., which helps it maintain stability during economic fluctuations [6][7] - The company's market capitalization of approximately $200 billion provides it with scale advantages, a vast distribution network, and an industry-leading marketing team, further solidifying its position in the consumer staples sector [8] Group 3 - Despite facing growth challenges post-pandemic, PepsiCo is actively adapting its strategy to maintain growth, including recent acquisitions such as Sabra, Siete, and Poppi, which align with its long-term growth objectives [9][10][11] - The company's proactive measures to navigate current market conditions suggest a strong likelihood of returning to growth, as it has successfully managed similar challenges in the past [12]

Nearly a quarter through 2025, the S&P 500 (^GSPC -1.97%) is down year to date -- a noticeable step change after the index posted back-to-back 20% annual gains in 2023 and 2024.Some investors may be looking for companies with compelling valuations that could be good buys even during a period of market turbulence, while others may be gravitating toward passive income opportunities.Here's why PepsiCo (PEP -0.26%) is a dream value and income stock to buy in April. Navigating a slowdownPepsi stock is hovering a ...

PepsiCo's NASDAQ: PEP nearly-$2-billion purchase of prebiotic soda maker Poppi is a reminder of the value consumers place on their beverages of choice. While Poppi has built its brand as a gut health-friendly drink, even more traditional sodas and energy drinks may be having a moment. The S&P 500 may be down nearly 2% year-to-date (YTD) as of Mar. 25, but three major beverage companies—Celsius Holdings Inc. NASDAQ: CELH, Monster Beverage Corp. NASDAQ: MNST, and Keurig Dr Pepper Inc. NASDAQ: KDP—are all up d ...

I buy a lot of dividend stocks each year. They provide me with passive income that I use to buy more shares of dividend-paying companies. Dividend stocks have also historically produced much higher returns than non-dividend payers, with less volatility. One dividend stock I can't seem to buy enough of right now is PepsiCo (PEP 0.71%). I've bought shares several times this year and will likely continue adding to my position. Here's why I've been loading up on Pepsi stock.A satisfying income streamPepsiCo has ...

Core Viewpoint - PepsiCo is experiencing its worst decline in years, with a 25% drop since its all-time high in 2023, marking the largest fall since the financial crisis of 2007-2009 [2][6] Group 1: Growth and Revenue - PepsiCo's growth has increasingly relied on price increases since the COVID-19 pandemic, with organic revenue growth of 2% in 2024, but a 1% decline in volumes [4][5] - The price of snacks and beverages has risen significantly, with potato chips up 44% and soda prices up 33% since January 2020, indicating inflation-driven growth rather than increased sales volume [3][4] Group 2: Financial Health - Despite the decline in share price, PepsiCo maintains a strong financial position with a dividend payout ratio of approximately 65% of 2025 earnings estimates and $9.2 billion in cash [6][7] - The company is recognized as a Dividend King, having raised dividends for 52 consecutive years, which remains attractive to investors [6][7] Group 3: Market Valuation - The stock's price-to-earnings ratio and long-term growth estimates have fallen to multiyear lows, prompting caution regarding valuation [8][9] - The dividend yield has increased to 3.7%, the highest ever, providing immediate income for investors amid lower growth expectations [9][10] Group 4: Future Outlook - While growth may slow, PepsiCo's established brands and market presence suggest modest growth and incremental dividend increases are still likely [7][10] - The current valuation at nearly 21 times earnings is considered high for expected growth rates of 4% to 5%, leading to a recommendation for a more appealing price-to-earnings ratio closer to 15 to 17 [9][10]