How Parkev Tatevosian, CFA’s view on $PEP changed

The next stock I will highlight as an undervalued dividend stock that you can buy is PepsiCo . Remember that PepsiCo doesn't just sell drinks, it sells snacks too. In fact, the snack food sector is thriving just as much as the beverage sector, and perhaps even better.

I calculated a fair value for PepsiCo stock of $180. The current market price is $128. Therefore, I calculated the possibility of PepsiCo stock rising by more than 40%.

PepsiCo is another undervalued stock that is not linked to artificial intelligence. The fair value I calculated for PepsiCo is $177, and given the current market price of $140, I calculated a 27% upside for Pepsi over the next 12 to 18 months.

This is a rare low valuation for a relatively safe company with stable sales and profits. Of course, one of the most optimistic factors, and the thing that makes me most optimistic about PepsiCo, is its own experience.

This is a business that is difficult to manage. You have to work with distributors, you have to work with suppliers, you have to deal with manufacturing, you have to be very good at marketing, and you have to bring all of that together on a large scale around the world.

This is a difficult thing to do. PepsiCo has been successful in managing this for decades and has demonstrated skill in this regard for decades with continuous improvements. That exclusive knowledge and experience is one of the main reasons for my optimism about PepsiCo stock and one of the reasons why it is rare to find this stock at a low price.