PepsiCo (PEP) Stock Forecast & Price Target

PepsiCo has demonstrated strong financial performance, particularly in its Frito-Lay North America segment, which experienced growth rates of approximately 16% in 2022 and 10% in 2023, despite flat volumes, highlighting its resilience compared to other food brands. The company's substantial international presence, contributing 40% of total sales and operating profits in 2024, underscores its diversified revenue streams and global market reach. Additionally, the potential for strategic acquisitions, such as the anticipated acquisition of BeverageCo, may enhance PepsiCo's position for sustainable long-term growth, particularly in light of positive developments in its bottling operations.

PepsiCo faces significant macroeconomic pressures, compounded by category-specific challenges in carbonated soft drinks, especially within the diet segment. The Frito-Lay business is also experiencing a slowdown, which is expected to further restrict top-line growth. Historical data reveals that during the 2008–09 recession, PepsiCo's Next Twelve Months Price-to-Earnings (NTM P/E) ratio contracted nearly 40%, suggesting vulnerability in times of economic downturn.