You Didn’t Even Know You Loved Pepsi’s Stock!

With shares of Pepsico (NYSE:PEP) trading at around $68.43, is PEP an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:

C = Catalyst for the Stock’s Movement

pepsi-logoLet’s start out by saying that no news is good news. We can also say that the best investors are often boring investors. These are people who avoid high risk and stick to consistent winners such as Pepsi.

We could compare Pepsi and The Coca-Cola Company (NYSE:KO) all day, but we would come up with the same answer that everyone else has come up with, which is that it’s a very tight race with Coca-Cola having a slight edge. We will avoid this comparison because the future might have an entirely different landscape. On an international level, Pepsi products are likely to outperform Coca-Cola products, and the trend right now is in emerging markets. For example, Pepsi is currently shifting capital away from Europe and North America and into Asia, Latin America, Africa, and the Middle East.

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As far as the title of this article goes, if you’re not a Pepsi investor, then you might not realize all the products this company sells. These products include Gatorade, Tropicana, Aquafina, Sierra Mist, 7UP, Mountain Dew, Cheetos, Lays, Doritos, Cap’n Crunch, and much more. That being the case, there’s a pretty good chance that you don’t even realize how much of a role Pepsi plays in your life. There’s also a good chance that you love at least one of their products.

Regardless of your taste buds or overall diet, Pepsi has a history of increasing its dividend, which makes investors quite pleased. This is also a low-beta stock, which means you don’t have to worry about volatility too much. Pepsi might have slipped a little during the financial crisis of 2008/2009, but it was nothing compared to the drastic falls other companies experienced at that time. Pepsi was the equivalent of a secure lean-to during a landslide. As other stocks slid away, Pepsi found a safe location and waited out the storm.

It might already be evident that this will be a bullish article, but let’s take a look at some more important numbers before getting too excited.