Close

UBS Maintains a 'Buy' on Pepsico (PEP); Unmasking Value

May 25, 2011 10:14 AM EDT
Get Alerts PEP Hot Sheet
Price: $175.01 +0.83%

Rating Summary:
    18 Buy, 13 Hold, 0 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 13 | Down: 11 | New: 11
Join SI Premium – FREE
UBS maintains a 'Buy' on Pepsico (NYSE: PEP), PT increased from $76 to $82.

UBS analyst says, "Our new sum of the parts valuation supports our target increase to $82; derived by assigning a target multiple to Pepsi’s three main reporting segments: Pepsi Americas Foods (PAF), Pepsi Americas Bevs (PAB) and Pepsi International (PI). We believe the company’s enviable portfolio of strong brands, margin resiliency, pricing power, and solid growth prospects warrant valuation upside."

"While PEP is up 5.5% over the last month, its performance is similar to other large multi-national consumer names such as P&G (NYSE: PG), Kraft (NYSE: KFT), and General Mills (NYSE: GIS). PEP shares remain at a wide discount vs. Coca-Cola (NYSE: KO), and improving trends in the US bevs business will lead to a narrower valuation gap vs. historical levels. Risks to our thesis include execution missteps (part. in “NutriCo”), commodity head winds, and tougher summer comps."

For more ratings news on Pepsico click here and for the rating history of Pepsico click here.

Shares of Pepsico closed at $70.98 yesterday.


Serious News for Serious Traders! Try StreetInsider.com Premium Free!

You May Also Be Interested In





Related Categories

Analyst Comments

Related Entities

UBS