Pepsi is a great buying opportunity despite falling more than 20 percent over 5 years; a 14 forward PE, over 4 percent yield and stable business support it. Recent earnings were very good: revenue up 6 percent, operating profit up 19 percent, net income and EPS up 17 percent; low growth prevents an A+ but not buying.
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The first of the three stocks I don't own is Pepsi, which is actually a great opportunity. This stock has fallen more than 20 percent in the last 5 years. This is a big drop for Pepsi, but it's a really great opportunity to buy right now.
So, Pepsi, this stock has a forward PE ratio of 14. This stock has a dividend yield of over 4 percent, right ? And of course a very stable business model. I was looking at their recent earnings, and with the stock price so low right now, you might think that this company's earnings must be terrible.
Look at this. A- grade income statement. It was A- grade. Revenue increased by 6 percent. Selling expenses increased by 4 percent. That means your total profit will be good. Total profit increased by 7 percent.
Selling and general administrative expenses increased by 4%. Operating profit increased by 19%. Pre-tax income increased by 17%, net income by 17% and diluted EPS by 17%.
Very, very good report for Pepsi. It was A-grade , right? They ca n't be given an A+ because they don't have enough growth to get an A+. If it had been 15% or 20% growth, I would have given them an A +, but I can't give them an A+ for 6% growth, but Pepsi's report is still great, right?
So, this is definitely a stock I would say is worth buying, right ?
What this channel has said about $PEP
Financial Education has only this one call on this stock.