Freedom Capital Markets Maintains Hold Rating on Pepsi Amid Modest Growth Outlook

PepsiCo, Inc. (NASDAQ:PEP) is one of the best dividend stocks to buy. On October 23, Freedom Capital Markets downgraded Pepsi to Hold from Buy, while also trimming its price target from $170 to $164. Freedom Capital sees a modest upside potential of 7%.

The rating update came in light of Pepsi’s Q3 fiscal 2025 results, which topped market forecasts for sales and EPS, also leading to a share price rally.

Freedom Capital Markets Maintains Hold Rating on Pepsi Amid Modest Growth Outlook

ja-san-miguel-xYSp0kkIUio-unsplash

Revenue growth for Pepsi increased compared to the prior quarter, although it still lingers near the low single-digit range. However, the company reiterated its full-year revenue outlook after the earnings release and boosted its EPS growth guidance for FY2025. Moreover, the company has maintained a consistent track record of quarterly dividend payouts since 1965, increasing its dividend for the 53rd consecutive year in 2025.

Independent of the analyst action, PepsiCo, Inc. (NASDAQ:PEP) announced on October 27 that it settled a lawsuit claiming that it misrepresented Gatorade protein bars as healthy, despite them packing more sugar than chocolates and donuts, and the protein component is rather low. A California-based District Judge, Casey Pitts, overruled the proposed class action, citing prejudice. This means that the judge concluded the case with no option for refiling, in response to a request by Pepsi and three fitness enthusiasts who filed the lawsuit.

While we acknowledge the risk and potential of PEP as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than PEP and that has 10,000% upside potential, check out our report about this cheapest AI stock.

READ NEXT: Dow 20 Stocks List: Ranked By Hedge Fund Bullishness Index and 10 Unstoppable Dividend Stocks to Buy Now.

Disclosure. None.