PepsiCo, Inc. (PEP), headquartered in New York, is a global leader in the food and beverage industry, offering a wide range of products including snacks, cereals, dairy items, and beverages under renowned brands like Lay's, Doritos, Gatorade, Pepsi-Cola, Mountain Dew, Quaker, and Aquafina. Valued at a market cap of $216.5 billion, PepsiCo also markets ready-to-drink tea and coffee alongside brands such as Crush and Dr Pepper. Its diverse revenue streams from the food sector distinguish it from competitors like The Coca-Cola Company (KO).

Companies worth $200 billion or more are generally described as “mega-cap stocks,” and PepsiCo fits right into that category. Its market cap exceeds this threshold, reflecting its substantial size, stability, and influence in the consumer defensive sector. Its global distribution network ensures a strong presence in over 200 countries, while its focus on innovation and healthier product options aligns with evolving consumer preferences. The company's diversification into food products provides a balanced revenue mix and resilience against market shifts. 

Additionally, PepsiCo’s robust marketing strategies and strategic partnerships further solidify its leadership in the food and beverage industry.

But it's not all sunshine and rainbows for the stock. PepsiCo shares are trading 14% below its 52-week high of $183.41, achieved on May 16. However, shares of PEP have plunged 11% over the past three months, lagging behind the broader Nasdaq Composite ($NASX), which has surged 19% over the same time frame.

In the longer term, PEP stock is down 7.1% on a YTD basis, and over the past 52 weeks, the stock has tumbled by 5.8%. By contrast, the $NASX is up 32.3% in 2024 and 40.4% over the past 52 weeks.

PEP has witnessed major volatility over the past year and has been trading below its 50-day and 200-day moving averages since late October, indicating a bearish trend.

Despite its sluggish price momentum over the past year, PepsiCo's shares rose 1.9% on Oct. 8, driven by its Q3 earnings beat, with core EPS of $2.31 surpassing analyst expectations and increasing 2.7% year-over-year. Although the company reported lower-than-expected revenue of $23.3 billion, it delivered robust international results, achieving 4% organic revenue growth and notable volume increases. Furthermore, the company reaffirmed its forecast of at least 8% core EPS growth for 2024, further boosting investor sentiment.

To emphasize the stock’s underperformance, it is worth noting that PepsiCo’s top rival, Coca-Cola, continues to outshine PEP. KO stock has surged 6.7% over the past 52 weeks and 6.1% on a YTD basis, dwarfing PEP’s returns over the same time frames. 

Despite PepsiCo’s underperformance, analysts are cautiously optimistic about its future. The stock has a consensus rating of “Moderate Buy” from the 19 analysts covering it, and the mean price target of $183.28 reflects a premium of 16.2% to current levels.