PepsiCo (PEP) was added as a long idea at Hedgeye with the potential for 30%+ upside by 2027 and 50% over the long term. Shares of PepsiCo edged higher by 0.8%.
“PepsiCo has already implemented many Elliott-backed initiatives—manufacturing rationalization, SKU reduction, and higher FCF focus,” Hedgeye analyst Daniel Biolsi wrote in a note on Sunday. “Incremental urgency around innovation and customer value, alongside cost savings, should accelerate organic revenue growth and expand margins.”
“Despite secular snack tailwinds, PFNA has underperformed amid affordability pressures, health trends, GLP-1 adoption, and SNAP uncertainty,” Biolsi added. “As PepsiCo’s largest earnings lever, early signs of stabilization—potentially visible in Q4—support a performance inflection and attractive entry point.”
Pepsi (PEP) is trading at the widest discount to Coca-Cola (KO) in decades, which is reflected in a historically high dividend yield and low growth expectation, according to Biolsi.