2024-03-11 15:37:36 ET
Summary
- PepsiCo, Inc.'s recent revenue decline and missed targets highlight limited growth after several years of unsustainable inflation boosts.
- Investors over-love the Dividend Aristocrat concept, making the investing focus too much on dividend hikes and not enough on earnings growth rates.
- PepsiCo stock is overvalued compared to its financial goals and trades at nearly 3x the growth rate, leading to underperformance in the recent past and future.
PepsiCo, Inc. ( PEP ) has turned into one of the most over-owned stocks despite consistently meager growth results. The stock price is vastly disconnected from the growth opportunities ahead, even after years of PepsiCo underperforming the S&P 500 (SP500). My investment thesis is Bearish on the consumer staples stock still trading at a premium valuation, even after the large dip from the highs last May....
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PepsiCo: Too Much Dividend Love