Core Insights - PepsiCo Inc. has experienced a decline in its share price, leading to a price-to-earnings (P/E) multiple below the industry average, reflecting investor concerns about near-term growth and margin pressures [2][7] - Despite these challenges, PepsiCo's current valuation appears attractive for long-term investors, with a forward 12-month P/E of 16.27X, below the industry average of 17.5X [3][4] Valuation Comparison - PepsiCo's P/E ratio of 16.27X is significantly lower than competitors like Coca-Cola (21.51X), Vita Coco (34.75X), and Monster Beverage (33.93X), indicating a valuation discount [4] - The company's forward price-to-sales (P/S) ratio of 1.96X is also below the industry average of 4.66X, further suggesting potential value for investors [3] Recent Performance - Over the past month, PepsiCo's shares have declined by 6.9%, underperforming the broader industry and the S&P 500 [5] - The stock has also lagged behind key competitors, with Coca-Cola down 1.2%, while Monster Beverage and Vita Coco saw gains of 1.9% and 3.7%, respectively [5] Market Dynamics - PepsiCo faces near-term pressures from volume softness in its North American segment, cost inflation, and tariff-related supply chain challenges [7][14] - However, the company is seeing recovery in its beverage segment, supported by innovation and strong brand performance, particularly in international markets [15][19] Earnings Estimates - The Zacks Consensus Estimate for PepsiCo's 2025 EPS remains unchanged, while the estimate for 2026 EPS has decreased by 0.3%, indicating a decline in analyst confidence regarding growth potential [16] - For 2025, sales are expected to grow by 1.9%, while EPS is projected to decline by 0.5%. For 2026, sales and EPS are estimated to grow by 3.7% and 5.4%, respectively [17] Strategic Initiatives - PepsiCo's management is focused on improving performance in its North American segment through cost reductions, portfolio transformation, and enhanced pricing strategies [18][20] - The company continues to leverage its strong brand portfolio and innovation pipeline to stabilize margins and drive long-term growth [20]

Core Insights - Celsius Holdings, Inc. (CELH) experienced a significant acceleration in U.S. retail performance in Q3 2025, with portfolio retail sales increasing by 31% year over year for the 13 weeks ending September 28, 2025, outpacing the broader ready-to-drink (RTD) energy category and achieving market share expansion [1][4]. Retail Performance - The combined portfolio of CELSIUS, Alani Nu, and Rockstar Energy captured a 20.8% dollar share of the U.S. RTD energy market, marking a 2.1 percentage point increase from the previous year and a 1.2-point sequential gain, indicating that the 31% retail sales increase was driven by portfolio-level share gains rather than overall category growth [2][8]. - Alani Nu led the growth within the portfolio, with retail sales soaring by 114% year over year and dollar share increasing by 3.3 points to 7.2%, supported by expanded distribution [3][8]. - The CELSIUS brand saw a 13% increase in retail sales but faced a 0.5-point year-over-year decline in dollar share to 11.2% [3][8]. - Rockstar Energy, acquired late in the period, reported a 9% decline in retail sales and a 0.7-point decrease in dollar share to 2.4% [3][8]. Market Trends - The combined portfolio of Celsius Holdings grew nearly twice as fast as the U.S. energy drink category during the quarter, with overall results indicating that the increase in retail sales coincided with aggregate market share gains [4]. - Management emphasized the importance of monitoring the durability of retail and share trends across brands and channels as the company moves into 2026 [4]. Competitor Insights - PepsiCo reported steady retail performance across its beverage portfolio in Q3 2025, driven by consumer demand for zero-sugar and functional offerings, with brands like Gatorade and Propel contributing positively [5]. - Coca-Cola also cited solid retail trends in Q3, supported by the strength of its zero-sugar portfolio and improved execution across key beverage categories [6]. Stock Performance and Valuation - Celsius Holdings' shares have increased by 0.8% over the past six months, contrasting with a 10.9% decline in the industry [7]. - The company trades at a forward price-to-earnings ratio of 28.98, significantly higher than the industry average of 14.59 [9]. - The Zacks Consensus Estimate for CELH's earnings implies year-over-year growth of 81.4% for 2025 and 20.4% for 2026 [10].

Core Insights - The Coca-Cola Company (KO) demonstrated a resilient performance in Q3 2025, particularly in North America, despite mixed global results [1][10] - The company achieved 6% organic revenue growth and 6% comparable EPS growth, driven by disciplined pricing, marketing transformation, and innovation [4][10] North America Performance - North America was a bright spot for Coca-Cola, showing sequential volume improvement for the second consecutive quarter [1][10] - The region's performance was supported by the company's focus on affordability through smaller packs and premium segments, contributing to value share gains [2][4] Global Market Dynamics - Global performance was uneven, with Latin America and Asia Pacific facing macroeconomic and weather-related challenges, particularly in Mexico, India, and parts of ASEAN [3][10] - Despite these challenges, Coca-Cola continued to gain value share in most markets and maintained or expanded share across all geographic segments [3][4] Competitive Landscape - Coca-Cola's key rivals, PepsiCo and Monster Beverage, are experiencing distinct paths in North America, with both companies showing improvements in beverage volumes and innovation [6][7][8] - The competitive landscape is evolving as consumer spending and pricing strategies shift, raising questions about the sustainability of growth for these companies [6][7][8] Financial Metrics - Coca-Cola's shares have increased by 12.4% year-to-date, outperforming the industry growth of 7.1% [9] - The company trades at a forward price-to-earnings ratio of 22.07X, which is higher than the industry's 18.36X [12] - The Zacks Consensus Estimate indicates year-over-year earnings growth of 3.1% for 2025 and 8.2% for 2026, with recent estimates for 2025 remaining unchanged [13][14]

Core Insights - PepsiCo Inc. (PEP) shares increased by 3.7% following a stronger-than-expected Q3 2025 earnings report, driven by solid pricing gains and resilient demand, raising questions about the sustainability of this rally [1][9] - The company's earnings and revenues surpassed the Zacks Consensus Estimate, indicating strong performance [1][9] Financial Performance - PepsiCo's Q3 performance was bolstered by steady momentum in its North America beverage business and growth in international markets, with net revenues rising by 3% [2][12] - The company has seen a 10.7% stock rally over the past three months, outperforming the broader industry, which declined by 1.7% [3][9] - PepsiCo's stock price is currently $150.08, which is 15.4% below its 52-week high of $177.50 and 17.6% above its 52-week low of $127.60 [8] Competitive Positioning - PepsiCo's performance has outpaced competitors like The Coca-Cola Company (KO) and Keurig Dr Pepper Inc. (KDP), which have seen declines of 3.5% and 22.3%, respectively, over the past three months [4] - Despite this, PepsiCo's shares have underperformed compared to Monster Beverage Corporation (MNST), which rallied by 16.7% in the same period [4] Growth Drivers - The company's growth is attributed to balanced performance across beverages, snacks, and international markets, with significant contributions from Trademark Pepsi and Pepsi Zero Sugar [12][13] - PepsiCo's international segment achieved its 18th consecutive quarter of mid-single-digit organic revenue growth, particularly strong in markets like Brazil, the U.K., Türkiye, and China [12] Future Outlook - Management remains optimistic about sustaining growth momentum, expecting continued resilience in international business and improving profitability in North America [14] - For fiscal 2025, PepsiCo reaffirmed guidance for low-single-digit organic revenue growth and flat year-over-year core constant-currency EPS [15] Valuation Metrics - PepsiCo's forward 12-month P/E ratio is 17.79X, slightly above the industry average of 17.73X but below the S&P 500's average of 22.93X [18][19] - The stock's valuation is lower than competitors like Coca-Cola and Monster Beverage, which have higher P/E ratios of 21.21X and 33.29X, respectively [19] Analyst Sentiment - The Zacks Consensus Estimate for PepsiCo's 2025 and 2026 EPS has been revised upward by 0.6% and 0.4%, respectively, indicating growing analyst confidence in the company's growth potential [16] - The current setup presents an appealing opportunity for investors, supported by steady fundamentals, favorable estimate trends, and reasonable valuation [20][23]