PEP | Weekly | Haru Insights

PepsiCo dramatically revised its full-year core EPS guidance down to 1–3.5%, a stark reversal from prior forecasts of 5–7% growth, driven by weakening North American volume trends, deteriorating margins, and persistent input cost pressures.
The company issued a €1 billion Eurobond at a widening spread above mid-swaps, signaling a strategic pivot to international capital and highlighting growing strain on domestic funding access amid macroeconomic headwinds.

PepsiCo’s international divisions, especially EMEA and LatAm Foods, are delivering nearly half of YTD profits, proving that growth is still viable outside North America and offering a critical foundation for future recovery.
The company’s $746 million share repurchase program and 16.9% margin expansion reflect disciplined capital management and operational resilience, reinforcing confidence in execution despite broader challenges.
Strategic innovation in health-forward products—like Doritos Protein and partnerships with Celsius and Poppi—signals genuine momentum toward consumer trend alignment, positioning PEP to capture shifting dietary preferences.
Despite a stagnant share price, PEP remains attractively valued at a 14.7x forward P/E with a 4.7% yield and a $200 analyst target, suggesting significant upside if the turnaround plan gains traction.
The continued expansion of its snack portfolio and under-the-radar success in non-carbonated categories demonstrate a viable path to diversify beyond the collapsing soda business.

PepsiCo, Inc. (PEP)[Tv]