UBS Maintains a 'Buy' on Pepsico (PEP); Cautiously Optimistic

UBS maintains a 'Buy' on Pepsico (NYSE: PEP), price target lowered from $82 to $79.

UBS analyst says, "Following 2Q’11 earnings, we revisited our 2011 numbers. Pepsi delivered EPS in-line with our expectations. However, enthusiasm for the remainder of the year was dampened with the second lowering of guidance in 12 months. PEP now expects 5-7% currency neutral EPS growth, which, with WBD accretion, represents only 3-5% organic EPS growth. Our new ‘11 EPSe is $4.47, while our ‘12 remains unchanged. With lower core growth expectations, we are lowering our applied multiple to 16x, resulting in a new price target of $79."

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

Shares of Pepsico closed at $66.17 yesterday.

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