New Lifetime High For PepsiCo (PEP)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified PepsiCo ( PEP) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified PepsiCo as such a stock due to the following factors:

  • PEP has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $372.1 million.
  • PEP has traded 3,046 shares today.
  • PEP is trading at a new lifetime high.

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More details on PEP:

PepsiCo, Inc. operates as a food and beverage company worldwide. Its Frito-Lay North America segment offers Lay's and Ruffles potato chips, Doritos and Tostitos tortilla chips, Cheetos cheese flavored snacks, dips, Fritos corn chips, and Santitas tortilla chips. The stock currently has a dividend yield of 2.9%. PEP has a PE ratio of 20.6. Currently there are 12 analysts that rate PepsiCo a buy, no analysts rate it a sell, and 4 rate it a hold.

The average volume for PepsiCo has been 4.2 million shares per day over the past 30 days. PepsiCo has a market cap of $137.4 billion and is part of the consumer goods sector and food & beverage industry. The stock has a beta of 0.32 and a short float of 0.6% with 2.67 days to cover. Shares are up 11.6% year-to-date as of the close of trading on Tuesday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more. Analysis:

TheStreet Quant Ratings rates PepsiCo as a buy. The company's strengths can be seen in multiple areas, such as its increase in stock price during the past year, revenue growth, good cash flow from operations, growth in earnings per share and expanding profit margins. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

Highlights from the ratings report include:
  • The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 4.7%. Since the same quarter one year prior, revenues slightly increased by 0.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Net operating cash flow has slightly increased to $2,491.00 million or 7.69% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -2.86%.
  • PEPSICO INC reported flat earnings per share in the most recent quarter. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, PEPSICO INC increased its bottom line by earning $4.32 versus $3.92 in the prior year. This year, the market expects an improvement in earnings ($4.59 versus $4.32).
  • The gross profit margin for PEPSICO INC is rather high; currently it is at 57.56%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 11.70% trails the industry average.


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