All You Need to Know About PepsiCo (PEP) Rating Upgrade to Buy

Core Viewpoint - PepsiCo (PEP) has received an upgrade to a Zacks Rank 2 (Buy), indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on changes in earnings estimates, which are strongly correlated with near-term stock price movements [4][6]. - Institutional investors utilize earnings estimates to determine the fair value of stocks, leading to buying or selling actions that affect stock prices [4]. Recent Performance and Outlook - PepsiCo's earnings estimates have been rising, with a Zacks Consensus Estimate of $8.03 per share for the fiscal year ending December 2025, showing no year-over-year change [8]. - Over the past three months, the Zacks Consensus Estimate for PepsiCo has increased by 2%, reflecting an improving business outlook [8]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with only the top 20% of stocks receiving a "Strong Buy" or "Buy" rating [9][10]. - PepsiCo's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10].