Company Overview - PepsiCo is one of the world's largest convenience food and beverage companies, generating over $90 billion in revenue and $15 billion in operating profit [2] Leadership and Experience - The leadership team includes Chairman and CEO Ramon Laguarta and EVP and CFO Jamie Caulfield, who collectively have 60 years of experience at PepsiCo, with a strong operational background [3] Growth Performance - Since Ramon Laguarta took over in 2018, PepsiCo has focused on re-accelerating growth, resulting in a 40% increase in revenues and over 50% growth in earnings per share (EPS) on a currency-neutral basis [3]

Group 1: Core Business Performance - PepsiCo experienced a 2% organic sales growth in 2024, driven by strong performance in international markets, despite a previous year's growth of 9% and challenges such as a significant safety recall [4] - The company anticipates another year of subdued growth, projecting organic sales to rise by at least 2% and profits to expand around 4% [4][10] - Historical performance indicates that PepsiCo has managed to thrive during consumer spending downturns, with core earnings rising by 9% in 2024 despite only a 2% increase in organic sales [10] Group 2: Dividend and Income Generation - PepsiCo offers a dividend yield of 3.6%, significantly higher than the 1.2% yield of the broader S&P 500, and is recognized as a Dividend King for increasing its payout for 53 consecutive years [5][6] - The latest dividend increase was 5%, supported by the company's robust cash flow, which amounted to $13 billion in operating cash flow over the last two years [6] Group 3: Valuation and Market Position - The stock is currently valued at 21 times earnings, close to a five-year low, making it an attractive option compared to competitors like Coca-Cola and McCormick, which are valued at 28 and 27 times earnings, respectively [7][8] - On a price-to-sales basis, PepsiCo's ratio of 2.2 represents a multiyear low, indicating a potentially undervalued position in the market [8]

Core Insights - PepsiCo is a Dividend King with a 52-year streak of annual dividend increases, indicating a strong business model [2] - Kraft Heinz offers a higher dividend yield of 5.4%, but its dividend has been stagnant at $0.40 per share since 2019, raising concerns for income investors [3][7] - PepsiCo is currently facing a business slowdown and broader industry challenges, yet it reported a 2% increase in organic sales and a 9% rise in core earnings per share for 2024 [4][5] Company Performance - PepsiCo's outlook for 2025 is subdued, with management guiding for similar organic sales growth and earnings rates, reflecting a return to slow and steady growth [6] - Kraft Heinz's organic sales among its key brands fell by 4.5% in Q3 2024 and another 5.2% in Q4 2024, indicating ongoing challenges [9] - PepsiCo appears to be managing its short-term issues effectively, while Kraft Heinz is still in a turnaround phase, which may prolong its stagnant dividend situation [10][11] Investment Considerations - Long-term dividend investors may find PepsiCo's consistent dividend growth more appealing compared to Kraft Heinz's stagnant dividend and ongoing turnaround efforts [11] - The current high yield of PepsiCo, despite its lower yield compared to Kraft Heinz, may attract income-focused investors looking for stability [3][6]

Core Viewpoint - The performance disparity between Coca-Cola (KO) and PepsiCo (PEP) has become evident, with KO outperforming PEP over the last year, raising questions about which stock is the better buy currently [2][4][17]. Company Performance - PepsiCo reported mixed results in its latest quarterly release, exceeding EPS estimates but falling short on sales expectations, with FY24 organic sales increasing by 2% year-over-year compared to 9.5% in 2023, and adjusted EPS of $8.16 rising by 9% [5][12]. - North America results for PepsiCo were soft, with Frito-Lay sales declining by 0.5% year-over-year, a significant slowdown from the previous year's 9% growth [6][18]. - The decline in Frito-Lay sales is attributed to a shift in consumer preferences towards dining out, with Quaker Foods North America experiencing a 14% decline in organic sales due to an oatmeal recall [7][18]. - Despite the challenges in North America, PepsiCo's international results were strong, with organic sales climbing by 6% in FY24 [9]. - Analysts have adopted a bearish outlook on PepsiCo following its results, resulting in a Zacks Rank 4 (Sell) due to concerns over North America's performance [11]. - Coca-Cola exceeded both EPS and sales expectations, reporting growth rates of 12% and 6% respectively, and gained market share in the nonalcoholic ready-to-drink beverage sector in North America [12][13]. - Coca-Cola's overall price/mix increased by 11% in FY24, with unit case volume growing by 1% year-over-year, benefiting from its lower exposure to the snacks market compared to PepsiCo [13][14]. - Coca-Cola also performed well internationally, gaining market share in regions such as Latin America, Europe, the Middle East, and Africa [14]. Valuation - Coca-Cola shares currently trade at a forward 12-month earnings multiple of 21.8X, representing a 27% premium over PepsiCo's 17.2X, marking the steepest premium in the past five years [15]. - EPS for PepsiCo is expected to increase by 2% in FY25, while Coca-Cola is forecasted to see a 6% increase [15]. Summary - The recent financial results of both companies highlight a stark contrast, with Coca-Cola showing positive growth and market share gains, while PepsiCo faces challenges in its North American segment and a bearish outlook from analysts [17][18].

Group 1 - iREIT+HOYA Capital focuses on income-producing asset classes that provide sustainable portfolio income, diversification, and inflation hedging [1] - The service offers a free two-week trial for potential investors to explore exclusive income-focused portfolios [1] Group 2 - The market is characterized as one where stocks are available at various price points, suggesting opportunities for patient investors [2] - The focus is on defensive stocks with a medium- to long-term investment horizon [2]

Core Insights - The performance of PepsiCo's international operations is crucial for assessing its financial resilience and growth prospects, especially in the context of a global economy [1][2] International Revenue Performance - For the quarter ended December 2024, PepsiCo's total revenue was $27.78 billion, a slight decline of 0.2% year over year [4] - Europe generated $4.48 billion, representing 16.11% of total revenue, exceeding the consensus estimate of $4.41 billion by 1.59% [5] - Africa, Middle East, and South Asia contributed $2.03 billion, or 7.32% of total revenue, surpassing expectations by 2.37% [6] - Latin America accounted for $3.69 billion, or 13.28% of total revenue, falling short of the expected $3.76 billion by 1.84% [7] - Asia Pacific, Australia, and New Zealand and China Region generated $1.48 billion, constituting 5.34% of total revenue, slightly below the forecast of $1.49 billion by 0.62% [8] Future Revenue Forecasts - Analysts project total revenue of $18.15 billion for the current fiscal quarter, indicating a decline of 0.6% from the previous year [9] - For the full year, total revenue is expected to reach $93.01 billion, reflecting a 1.3% increase compared to last year [10] - Projected contributions from various regions include Europe at 15.1% ($14.02 billion), Africa, Middle East, and South Asia at 6.8% ($6.33 billion), Latin America at 12.6% ($11.68 billion), and Asia Pacific at 5.4% ($4.99 billion) [10] Conclusion - PepsiCo's reliance on international markets presents both opportunities and challenges, making it essential to monitor international revenue trends for future projections [11]

Company Overview - PepsiCo, Inc. generated nearly $92 billion in net revenue in 2024, driven by a diverse portfolio of beverages and convenient foods [2] - The company's product portfolio includes iconic brands such as Lay's, Doritos, Cheetos, Gatorade, Pepsi-Cola, Mountain Dew, Quaker, and SodaStream, with many brands generating over $1 billion in estimated annual retail sales [2] Strategic Vision - PepsiCo aims to be the global leader in beverages and convenient foods through its strategic initiative, pep+ (PepsiCo Positive), which focuses on sustainability and human capital [3] - The pep+ initiative emphasizes creating value and growth while operating within planetary boundaries and inspiring positive change for both the planet and people [3] Upcoming Events - Ramon Laguarta, Chairman and CEO, along with Jamie Caulfield, Executive Vice President and CFO, will present at the Consumer Analyst Group of New York (CAGNY) Conference on February 19, 2025, at approximately 9:00 a.m. ET [1]

With PepsiCo's (NASDAQ: PEP ) recent Q4 and full-year earnings now in the books, it's apparent the company continues and will likely continue to face headwinds, at least for the near to medium term.Contributing analyst to the iREIT+Hoya Capital investment group. The Dividend Collectuh is not a registered investment professional nor financial advisor and these articles should not be taken as financial advice. This is for educational purposes only and I encourage everyone to do their own due diligence. I'm a ...

PepsiCo (PEP -0.53%) stock fell 4.5% on Tuesday, putting it within just a couple of percentage points of a 52-week low.The food and beverage titan reported fairly weak full-year 2024 results. 2025 guidance calls for a prolonged slowdown across its business units, with a low single-digit increase in organic revenue and a mid-single-digit rise in core constant currency earnings per share (EPS).Despite the poor results and bleak outlook, here are three reasons why PepsiCo is a dividend stock worth buying now. ...

When searching for new stocks to invest in, dividend investors usually try to find a good compromise between income, income stability, and growth potential. There's no perfect investment that scores high on all three at once, so trade-offs have to be made. Right now, PepsiCo (PEP -0.53%) looks like it is offering investors a good combination of positives because it is facing some near-term negatives that seem likely to be temporary headwinds.Here's why buying PepsiCo today could help to set you up for a lif ...