PepsiCo: Well-Run Business Temporarily Fallen From Grace (Rating Upgrade)

Summary:

• PepsiCo’s stock recently hit a 52-week low, presenting a buying opportunity for long-term dividend investors, despite ongoing economic headwinds and inflation concerns.
• The stock’s drop is attributed to the FED’s revised interest rate cut expectations, impacting discretionary sectors, including Pepsi.
• Pepsi’s strong balance sheet, solid dividend history, and undervalued stock price signal a potential double-digit upside once inflation stabilizes.
• I upgrade Pepsi from a hold to a buy due to its attractive price point, growth potential through acquisitions, and a reliable dividend yield of over 3%.
• Pepsi could see increased volatility due to inflation uncertainty, which poses further downside risks.

Introduction

PepsiCo (NASDAQ:PEP), the snack and beverage maker we all know and love, but not now, recently hit a new 52-week low, falling below $150 a share. The company is a fairly new position in my portfolio, and I’ve been taking advantage of

Analyst’s Disclosure: I/we have a beneficial long position in the shares of PEP either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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