1D·

PEP is currently trading at May/June 2019 levels

$PEP (-1,16 %) currently trading at May/June 2019 levels

You can now buy it around 16x P/E, compared to 23x P/E in 2019.

Back to normal P/E of 21 by 2027 would be 195$ almost 50% ROR.

If it goes sideways to fair value of 15x for a while, you still get 4% dividend.

What do you guys think?

4 Comentarios

Mikolaj@Volcano

In my opinion, @Soprano point is already incorporated in the price. At this moment $PEP is quite decent opportunity and here is why:
1. It is one of the most resilient US companies in a trade war environment. Although they are originated in US, the business itself is decentralized and their products are made locally.
2. Recently, they made nice acquisition that will allow them to introduce more healthy snacks/drinks to further diversify their portfolio of products.
3. Recent earnings, dividends, price, and future pipeline of products look good and promising.
4. They are one of the companies like ETF, like Microsoft. So even if one of their products are less popular they they still have others.
By speaking all of that I still do think that we didn't saw the bottom price yet. It is all related to turbulent times and many problems that US economy will face in the upcoming months/years. My price point that I plan to buy more shares is around $110-$120.

•

Soprano@Soprano

Pepsi is losing market share in the softdrink market. Currently there is not much hope for them to turn that trend around so yeah supposedly Pepsi will keep underperforming the market. Dividend doesn’t matter in that regard since it will get deducted from the price anyway

•

QUANTIJS@QUANTIJS

@Soprano Pepsi has much more products than softdrink (check your doritos chips backside) and their earnings are still increasing, so I guess it will be just a matter of time until the price will start to follow earnings. Maybe it will take some more time now that we have tarrifs.

•

Soprano@Soprano

12H

@QUANTIJS I know that that's why I specifically mentioned the softdrink market share instead of just saying market share. However their beverage section is larger than their snack section. They currently improve the earnings only by raising the prices. But essentially you cannot do that forever and keep selling less and less goods but making them gradually more expensive.

•