Update shared on08 Sep 2025
Fair value Increased 0.24%PepsiCo’s consensus price target saw a modest upward revision to $154.24, driven by analyst optimism around its expanded partnership and equity alignment with Celsius, the expected revenue and margin growth from acquiring Rockstar, and the enhanced energy drinks portfolio, execution, and distribution strategy.
Analyst Commentary
- Bullish analysts cite the expanded partnership between PepsiCo and Celsius Holdings—including Celsius' acquisition of the Rockstar brand, Alani Nu's transition into the PepsiCo distribution system, and Celsius being named the U.S. strategic energy captain—as significant drivers of future revenue and EBITDA growth.
- Analysts expect the updated PepsiCo-Celsius agreements to accelerate growth for Alani Nu and provide Celsius with improved control and execution over its energy drink portfolio through expanded distribution, especially in c-store and foodservice channels.
- The additional equity investment by PepsiCo and increased ownership stake in Celsius are viewed as a key positive, underpinning strong alignment between the two companies and enhancing Celsius' strategic importance to PepsiCo's portfolio approach in the energy category.
- The acquisition of Rockstar is projected to add substantial incremental revenue ($250M annually) and provide new long-term margin expansion opportunities as Celsius integrates and optimizes its combined energy drinks business.
- The partnership is seen as a reaffirmation of PepsiCo’s innovative, portfolio-based strategy for competing within the energy drinks sector, while recent execution improvements, productivity gains, and U.S. distribution expansion support higher visibility into PepsiCo’s own earnings trajectory.
What's in the News
- Elliott Investment Management has built a ~$4B stake in PepsiCo, becoming one of its largest active investors and plans to push for changes to revive the share price (WSJ).
- PepsiCo is increasing its stake in Celsius Holdings to 11% via a $585M deal, acquiring convertible preferred stock (Bloomberg).
- The Celsius transaction will see Celsius acquire PepsiCo’s Rockstar Energy brand rights for the U.S. and Canada (Bloomberg).
- PepsiCo plans to raise U.S. carbonated soft drink prices to offset tariffs on concentrate and aluminum, along with other cost pressures (Beverage Digest).
- Elliott’s $4B investment represents one of the activist fund’s largest equity stakes ever (WSJ).
Valuation Changes
Summary of Valuation Changes for PepsiCo
- The Consensus Analyst Price Target remained effectively unchanged, moving only marginally from $153.86 to $154.24.
- The Future P/E for PepsiCo remained effectively unchanged, moving only marginally from 21.59x to 21.65x.
- The Consensus Revenue Growth forecasts for PepsiCo remained effectively unchanged, at 3.4% per annum.
Disclaimer
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