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.

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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.

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Disclosure. None.