PepsiCo Stock: Is PEP Underperforming the Consumer Defensive Sector?

With a market cap of $192.5 billion, PepsiCo, Inc. (PEP) is a global leader in the manufacture, marketing, distribution, and sale of a broad range of beverages and convenient foods. The company distributes its products through direct-store-delivery, customer warehouses, third-party networks, and e-commerce platforms, serving a wide variety of retail and foodservice customers worldwide.

Companies valued at $10 billion or more are generally classified as “large-cap” stocks, and PepsiCo fits this criterion perfectly. Its diverse portfolio includes iconic brands such as Pepsi-Cola, Frito-Lay, Quaker, Gatorade, Tropicana, and Mountain Dew, operating across seven segments spanning North America, Latin America, Europe, Africa, the Middle East, South Asia, and the Asia Pacific region.

Shares of the Purchase, New York-based company have pulled back 17.7% from its 52-week high of $171.48. Shares of PepsiCo have declined 3.6% over the past three months, lagging behind the State Street Consumer Staples Select Sector SPDR ETF’s (XLP) 1.2% rise over the same time frame.

Longer term, the food and beverage giant stock is down 1.7% on a YTD basis, underperforming XLP’s 10% increase. Moreover, shares of PepsiCo have dipped 4% over the past 52 weeks, compared to XLP’s 6.5% return over the same time frame.

PEP stock has been trading below its 50-day moving average since March. Also, it has fallen below its 200-day moving average since May.

PepsiCo shares fell 3.3% on Jul. 9 as its North American food sales declined 2%, reflecting weaker snack demand and lower effective net pricing after price cuts on brands such as Lay’s and Doritos. Investors were also concerned about higher commodity, packaging and logistics costs in H2, compounded by high gas prices that hurt consumer demand more than expected.

Although Q2 2026 revenue rose 6.4% to $24.18 billion and core EPS increased to $2.20, PepsiCo left its 2026 outlook unchanged at 2% - 4% organic revenue growth and 4% - 6% core constant-currency EPS growth, disappointing investors looking for stronger guidance.

In comparison, rival The Coca-Cola Company (KO) has outperformed PEP stock. Shares of Coca-Cola have gained 31.2% over the past 52 weeks and 28.3% on a YTD basis.

Despite PEP’s weak price action, analysts are moderately optimistic about its prospects. The stock has a consensus rating of “Moderate Buy” from the 23 analysts covering the stock, and the mean price target of $155.14 is a premium of nearly 10% to current levels.