Pepsico (PEP) PT Raised to $159 at JPMorgan

JPMorgan analyst Andrea Teixeira raised the price target on Pepsico (NASDAQ: PEP) to $159.00 (from $158.00) while maintaining a Neutral rating.

The analyst comments: "PepsiCo (PEP, Neutral rated) is scheduled to report 1Q25 earnings results on Thursday, April 24th, before the open. We lowered our 1Q25/2025 OSG by -50 bps/-30 bps to +1.1%/+2.1% vs. consensus +0.5%/+2.2% on softer FLNA and slightly more conservative International estimates. Our 1Q25 EPS estimates move to $1.49 (from $1.52), which is in-line with consensus, while our 2025 EPS estimate is slightly higher by a penny at $8.32 (lighter FX headwind more than offsets lower OSG), or +2.0% YOY, which is 0.7% ahead of consensus $8.26, or +1.3% YOY. At a high level, we expect that investors are bracing for another soft quarter as consumption trends in the U.S. appear to have deteriorated for snacking while beverages remains lackluster, International has a smaller contribution in 1Q, and productivity phasing and investments will weigh on margins. We don’t envision a substantial change to guidance at this point on a constant-currency basis (albeit companies have more incentive to lower given the 'prisoner’s dilemma' of seeing other companies cutting). Management has seemed to be planning for a softer 1Q with improvement becoming more apparent by summer, although given the macro environment this may be more of a moving target."

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