PepsiCo (NYSE: PEP) will report its Q3 2023 results on Tuesday, Oct 10. We expect the company’s adjusted revenues to come in at $23.0 billion, slightly below the $23.4 billion consensus estimate. This would mark year-over-year growth of about 5%. Earnings are likely to come in at about $2.18 on a per-share and adjusted basis, slightly above the $2.15 consensus estimate. See our interactive dashboard analysis on PepsiCo Earnings Preview for more details on how the company’s revenues and earnings will likely trend for the quarter.
Interestingly, PEP has had a Sharpe Ratio of 0.4 since early 2017, which is lower than 0.5 for the S&P 500 Index over the same period. This compares with the Sharpe of 1.2 for the Trefis Reinforced Value portfolio. Sharpe is a measure of return per unit of risk, and high-performance portfolios can provide the best of both worlds.
PepsiCo
PEP
Looking at PepsiCo’s stock price, we believe that it has room for growth. We estimate PepsiCo’s valuation to be $199 per share, reflecting an 18% upside from the current levels. Our forecast is based on a 26x P/E multiple for PEP and expected earnings of $7.55 on a per-share and adjusted basis for the full year 2023. This compares with the last five-year average of 24x.
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