Coca-Cola (KO) stock fell as much as 4% early Tuesday after the company offered what CEO James Quincey called a "prudent" outlook for 2026 as it aims to reverse pressure on international sales. "We've taken what we think is a realistic, but prudent, approach relative to a number of international markets [where] we need to see improve through the course of 2026," Quincey told Yahoo Finance. In the fourth quarter, organic revenue grew 5% across the company's geographies, outpacing the 4.8% growth expecte ...

PepsiCo (NasdaqGS:PEP) Q4 2025 Earnings call February 03, 2026 08:15 AM ET Company ParticipantsDara Mohsenian - Managing DirectorFilippo Falorni - Director in Equity ResearchRamon Laguarta - CEORavi Pamnani - Head of Investor RelationsSteve Schmitt - CFOConference Call ParticipantsAndrea Teixeira - Managing Director and Senior Equity Research AnalystBonnie Herzog - Managing Director and Senior Consumer AnalystKevin Grundy - Senior AnalystLauren Lieberman - Managing Director and senior U.S. Equity Research A ...

Core Viewpoint - Kraft Heinz is planning to split into two separately traded companies, reversing its 2015 merger, amid a broader trend in the food industry where companies are divesting underperforming brands due to changing consumer preferences and regulatory pressures [1][2][18]. Industry Trends - The consumer products industry is experiencing a significant shift, with nearly half of M&A activity in 2024 coming from divestitures, as companies like Unilever and Keurig Dr Pepper also pursue similar strategies [3][2]. - The trend of breaking up is not limited to consumer packaged goods; industrial companies and legacy media firms are also undergoing similar transformations [4]. Market Dynamics - There is increasing pressure on packaged food and beverage companies due to lower demand and shrinking sales volumes, prompting them to divest underperforming brands to regain investor confidence [5][11]. - Consumers are shifting their purchasing habits towards fresh produce and protein, leading to declining sales for traditional grocery items [7]. Regulatory Environment - Regulatory scrutiny on processed foods is intensifying, influenced by health initiatives and the rise of medications that reduce appetite for sugary and salty snacks [8]. Competitive Landscape - Major consumer packaged goods companies are losing market share to upstart brands and private-label products, with only about 35% of their portfolios in high-growth categories compared to over half for private-label brands [9][10]. Financial Performance - Kraft Heinz has seen a 73% decline in its stock price since its merger, attributed to aggressive cost-cutting measures that neglected brand investment [19]. - The merger of Keurig Green Mountain and Dr Pepper Snapple Group in 2018 is cited as an example of a poorly conceived deal, leading to a significant rise in shares but still underperforming compared to the S&P 500 [15][14]. Strategic Moves - Kraft Heinz has appointed Steve Cahillane, former CEO of Kellogg, to lead the new entity focused on high-growth brands post-split [23]. - The divestiture trend is expected to continue, with companies like General Mills and Nestle also announcing sales of non-core brands to concentrate on their main offerings [25]. Acquisition Landscape - Smaller acquisitions are becoming more common, with deals under $2 billion representing a growing share of consumer products transactions, as larger deals face regulatory hurdles [26][27].

Core Insights - The beverage industry is experiencing significant mergers and acquisitions, with notable deals including PepsiCo's acquisition of Poppi for $1.95 billion and Celsius Holdings' purchase of Alani Nutrition for $1.8 billion [2] - Diageo is actively offloading assets, including the sale of Cacique rum for $81 million and its stake in Guinness Ghana Breweries [5][10] - Emerging markets are becoming a focal point for major beverage companies, as seen in Coca-Cola HBC's acquisition of a majority stake in Coca-Cola Beverages Africa for $2.6 billion [20] Group 1: Major Acquisitions - PepsiCo announced the acquisition of Poppi, a prebiotic soda brand, for $1.95 billion, highlighting the growing market for healthier beverage options [2] - Keystone Brewing Group acquired North Brewing for £71 million ($88.3 million) as part of a strategic partnership [3] - Molson Coors Beverage Co. acquired an 8.5% stake in Fevertree Drinks, a UK-based tonic and mixer maker [4] Group 2: Industry Trends - The beverage industry is seeing a trend of portfolio pruning, with companies like Diageo and Campari selling off non-core assets to focus on brands with stronger growth potential [6][11] - Diageo's CFO indicated plans for substantial changes to its product portfolio, aiming to save around $500 million in costs over three years [10] - The trend of vertical integration is evident, as NewPrinces acquired Carrefour's operations in Italy to enhance production and distribution [12] Group 3: Emerging Markets Focus - Coca-Cola HBC's acquisition of Coca-Cola Beverages Africa will create the world's second-largest Coke bottler, expanding its operations into 14 new African markets [20] - The acquisition of Alani Nutrition by Celsius Holdings reflects a growing interest in energy drinks and functional beverages in the US market [2] - The sale of Diageo's business in Kenya to Asahi Group Holdings for $2.3 billion underscores the strategic focus on emerging markets [25]

Core Insights - PepsiCo aims to establish Poppi as a new billion-dollar brand, as stated by executive Ram Krishnan at a recent event [1] - The company has implemented a franchise transfer initiative to expand Poppi's distribution channels [1] Acquisition Details - PepsiCo completed the acquisition of Poppi in May last year for an initial price of $1.65 billion, with potential total payments reaching $1.95 billion based on performance [1] - Krishnan highlighted that Poppi aligns well with PepsiCo's short, medium, and long-term beverage strategy, emphasizing its rapid growth and strong consumer engagement [1] Market Potential - The prebiotic soda category, to which Poppi belongs, is valued at approximately $440 million and is the fastest-growing segment within low-sugar beverages [1] - Poppi's sales have tripled annually since 2020, reaching $100 million in 2023, with analysts predicting the prebiotic soda market will nearly double by 2030 [1]

Core Viewpoint - PepsiCo is experiencing a challenging period, with stock performance declining for three consecutive years, leading to investor frustration [1][2] Group 1: Company Performance - The company has faced difficulties primarily in its food segment, with Frito-Lay and Quaker Oats reporting revenue and volume declines, particularly a 14% drop in Quaker's revenue and volume [5][10] - Despite these challenges, PepsiCo is implementing changes, such as promoting healthier snack options and launching new products like dye-free Cheetos and Doritos [7][8] - The beverage segment is also undergoing transformation, with the introduction of the world's first prebiotic cola and plans to reduce operating costs by 20% [8][10] Group 2: Future Outlook - Analysts predict a potential revenue growth of 3.4% year-over-year by 2026, which would be a significant achievement for the company [11] - Earnings per share are expected to rise from $8.11 this year to $8.58 next year, indicating a positive trend [11] - Investors will need to monitor sales and volume growth in both food and beverage sectors in the upcoming year to gauge the effectiveness of the company's turnaround efforts [10][12]

Core Insights - PepsiCo Inc. has experienced significant growth, with shares increasing by 3.8% in the past month, driven by strong business momentum across key segments [1][10] - The company reported healthy net revenue growth in Q3 2025, primarily due to the North America beverage business and demand for innovative products [1][10] - PepsiCo's performance has outpaced the broader Beverages – Soft Drinks industry and the Consumer Staples sector [3] Business Performance - The North America beverage segment has shown strong growth, particularly with Trademark Pepsi and innovations like Pepsi Zero Sugar and poppi [11] - International operations have maintained steady organic growth, with strong performance in key regions such as Latin America and Europe [12] - Cost-optimization initiatives have improved operating margins, contributing to overall performance [2][13] Competitive Positioning - PepsiCo's stock has outperformed competitors like Coca-Cola and Primo Brands, which have seen declines in the past month [7] - The current share price of $149.70 is 6.5% below its 52-week high, indicating potential for upside [8] - PepsiCo's P/E ratio of 16.92X is below the industry average and its major competitors, suggesting a potentially attractive valuation [18] Future Outlook - The Zacks Consensus Estimate for PepsiCo's 2025 EPS has increased slightly, while the estimate for 2026 has decreased [15] - The company is positioned for sustained organic growth and margin improvement through recent acquisitions and portfolio reshaping [14] - Despite near-term uncertainties, the company's fundamentals are gradually strengthening, making it a potential buy for investors [19][20]

Core Insights - PepsiCo Beverages North America (PBNA) is a crucial segment for PepsiCo, encompassing a wide range of beverage categories and contributing significantly to brand equity and profitability [1] Financial Performance - In Q3 2025, PBNA achieved 2% year-over-year organic revenue growth, despite a three-point volume decline due to the transition of its case-pack water business [2][9] - Trademark Pepsi saw volume and net revenue increases, driven by Pepsi Zero Sugar and effective marketing campaigns [2] - Retail sales for poppi grew over 50% year-to-date, while Propel is on track to exceed $1 billion in annual retail sales [3] Strategic Initiatives - PepsiCo is focusing on expanding zero-sugar offerings and scaling functional innovations, such as protein-infused beverages, while enhancing its presence in away-from-home channels [4] - The company has reduced over 35% of SKUs since 2022 to streamline operations and improve market execution [4][9] Margin Goals - PBNA is on a credible path to achieve its mid-teens operating margin target by 2026, supported by ongoing innovation and cost efficiency measures [5] - Execution risks remain, particularly concerning inflation and consumer price sensitivity, but current trends indicate significant progress [5] Competitive Landscape - Coca-Cola and Monster Beverage are also pursuing aggressive growth targets, with Coca-Cola showing strong organic revenue growth and Monster achieving 16.8% net sales growth [6][7] Valuation Metrics - PepsiCo shares have declined by 2.2% year-to-date, contrasting with the industry growth of 8.9% [8] - The forward price-to-earnings ratio for PepsiCo is 17.42X, below the industry average of 18.2X [10] Earnings Estimates - The Zacks Consensus Estimate for PepsiCo's 2025 earnings suggests a slight decline of 0.7%, while 2026 estimates indicate a growth of 5.9% [12]

Core Insights - PepsiCo has made significant acquisitions, including full ownership of Sabra, Obela, Siete Foods, and Poppi, marking a major diversification effort in its portfolio [1] - The company is undergoing a portfolio transformation and cost reduction strategy to enhance operations and respond to the growing demand for wellness and healthy snacks [2] - The consumer staples sector, including PepsiCo, has faced challenges due to rising living costs, inflation, and a weakening job market, leading to decreased foot traffic and demand for snacks and beverages [3][4] Company-Specific Summaries - **PepsiCo**: The company is focusing on diversifying its product offerings through acquisitions that do not overlap with its existing brands, aiming to adapt to changing consumer preferences [2][7] - **Procter & Gamble (P&G)**: P&G is demonstrating strong pricing power and modest earnings growth, with international markets helping to offset weaknesses in North America [8] - **Colgate-Palmolive**: Colgate is primarily focused on oral and home care products, maintaining a strong position in the toothpaste market, and has a high-margin pet nutrition segment [9][10][11] - **Kimberly-Clark**: The company is facing challenges following its acquisition of Kenvue, but it maintains strong brands in the diaper and tissue markets, which are resilient during economic downturns [12][14][15] - **Target**: Target is struggling to compete on price but is improving its in-store experience and e-commerce capabilities, still generating sufficient cash flow to support its dividend [16] Market Performance and Valuation - The consumer staples sector, including Dividend Kings like PepsiCo, P&G, and Colgate, has seen a decline in stock performance, with many companies trading at attractive valuations based on forward earnings projections [17][18] - Kimberly-Clark is noted for trading at a significant discount to its historical average, although this may change post-acquisition of Kenvue [18] - The current market conditions present a compelling opportunity for long-term investors to consider these Dividend Kings, particularly those with strong cash flow and dividend reliability [19]

Core Points - Carlsberg is investing £20 million ($40.1 million) in a new soft drinks canning line at its Rugby factory in the UK to significantly increase production capacity [1][2] - The new canning line will create over 30 permanent, full-time jobs, bringing the total number of employees at the Rugby site to more than 430 [2] - The Rugby facility will increase its production capacity from 560,000 to 610,000 canned soft drinks per hour, enabling the production of brands like Tango and Pepsi Max [1][3] Investment Strategy - This investment is part of Carlsberg's broader strategy to enhance its supply chain and production capabilities [2][3] - The total investment in the Rugby site over the past five years has exceeded £60 million [3] - The company is also focusing on operational efficiency and reducing carbon emissions, supported by a government grant for sustainability initiatives [4] Market Expansion - Carlsberg Britvic has signed an exclusive deal with an undisclosed retailer and is preparing to launch the US prebiotic soda brand Poppi in the UK within the next four months [5][6] - The new supply chain setup is expected to support the launch of Poppi, although it is not confirmed if the products will be produced locally or shipped from elsewhere [6]