PepsiCo downgraded to neutral at J.P.Morgan on 'limited room for positive surprises'

PepsiCo Inc.'s stock (PEP) was down by 0.7% in premarket trading on Tuesday after J.P.Morgan analyst Andrea Teixeira downgraded the soft drink and snack giant to neutral from buy and cut its price target to $176 a share from $185 a share. "We don't see anything fundamentally wrong with PEP and continue to have confidence that the company is well positioned to deliver on its 2024 outlook," said Teixeira. "That said, we see the magnitude of upward estimate revisions as narrowing and see better opportunity within beverages." Teixeira said Pepsi has been a "model of consistency" with "a lot of positive changes" by Chief Executive Ramon Laguarta, but the company appears to have left "limited room for positive surprises" on earnings. J.P.Morgan sees better opportunities with overweight-rated Coca-Cola Co. (KO) and Keurig Dr Pepper Inc. (KDP), Teixeira said.

-Steve Gelsi

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12-19-23 0740ET

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