5 Best Widow and Orphan Stocks To Buy

In this article, we discuss the 5 best widow and orphan stocks to buy. To read the detailed analysis of widow and orphan stocks, go directly to the 11 Best Widow and Orphan Stocks To Buy.

5. PepsiCo, Inc. (NASDAQ:PEP)

Number of Hedge Fund Holders: 65

PepsiCo, Inc. (NASDAQ:PEP) is one of the largest food and beverage companies in the world. The multinational corporation sells its products under major brands, including Pepsi, Lay’s, Quaker, Gatorade, 7UP, Doritos, Cheetos, and Ruffles.

On November 16, PepsiCo, Inc. (NASDAQ:PEP) announced a quarterly dividend of $1.265, payable by January 5 to the shareholders of record on December 1. At the time of writing on November 28, the dividend yield of the company was 2.99%.

On November 13, Jefferies analyst Kaumil Gajrawala started coverage of PepsiCo, Inc. (NASDAQ:PEP)’s stock with a Buy rating and a $203 price target. The firm called the company “the most likely [beverage name] to grow earnings high-single digits or better in the next three years.”

RiverPark Advisors commented on PepsiCo, Inc. (NASDAQ:PEP) in its third quarter 2023 investor letter. Here is what it said:

“PepsiCo, Inc. (NASDAQ:PEP): PepsiCo is a leading global beverage and snack food company with a portfolio of brands, including Lay’s, Doritos, Cheetos, Gatorade, Pepsi-Cola, Mountain Dew, Quaker and SodaStream. The company, through its operations, authorized bottlers, contract manufacturers and other third parties, makes, markets, distributes and sells a wide variety of beverages and snack foods, serving customers and consumers in more than 200 countries and territories.

PEP, through acquisitions, marketing, and product innovation has reinvigorated top line expansion and is now expected to grow revenues in the mid-single digit percent rate for the foreseeable future. We expect this revenue growth to drive margin expansion and free cash flow growth from $5.6 billion in 2022 to $12.3 billion in 2028. Based on this more than doubling of free cash flow and the company’s 2.8% dividend yield, we believe we can achieve double digit rates of return from the stock regardless of the economic environment ahead. We initiated a small position in August.”