© Reuters. PepsiCo (PEP) lower at JPMorgan regardless of constructive outlook: “more attractive options elsewhere”
JPMorgan downgraded beverage big PepsiCo (NASDAQ:) to Impartial from Chubby, decreasing its worth goal to $176 from $185 per share in a observe Tuesday. The shift in stance comes regardless of JPMorgan acknowledging PepsiCo’s “well-positioned” state and confidence in its 2024 outlook.
Analysts at JPMorgan stated they “don’t see anything fundamentally wrong” with PEP and proceed to believe within the enterprise and its means to ship on its 2024 outlook. Nonetheless, they see restricted potential for additional upward revisions to earnings forecasts and consider extra engaging funding alternatives exist elsewhere inside the beverage sector.
Particularly, JPMorgan highlighted Coca-Cola and Keurig Dr Pepper, citing their “higher quality composition of top-line growth” in 2024 and the dearth of the overhang related to the PEP GLP-1 issues.
The revised worth goal of $176 displays a 20x price-to-earnings a number of utilized to JPMorgan’s CY2025 earnings per share estimate of $8.82. “We believe PEP’s current valuation already reflects the bull & bear debate,” analysts on the funding financial institution acknowledged.
