Stock Analysis | Pepsico Outlook - Technicals Weigh Heavily as Earnings and Flow Signals Diverge

Market Snapshot

Takeaway: Pepsico is in a weak technical position with no bullish signals and five bearish indicators, but strong fundamentals and mixed analyst views still offer conflicting clues for investors.

News Highlights

• New U.S. Tariffs on Food and Beverages (August 1 and 4, 2025): The National Restaurant Association raised concerns that recent U.S. tariffs could increase the cost of popular items like coffee and hamburgers, potentially impacting consumer spending and beverage demand. While not directly affecting Pepsico's core business, rising costs could indirectly hurt consumption if consumers cut back.
• Almarai Acquires Pure Beverages Industry Co. (July 31, 2025): Almarai's acquisition in the Middle East adds regional competition for Pepsico in the global beverage space. While Pepsico isn't directly involved, this signals growing consolidation in the sector.
• Coca-Cola Expands in Africa (July 28 and 25, 2025): Coca-Cola Beverages Africa invested R365 million in a new bottling line in South Africa. This highlights continued global expansion by key rivals and puts pressure on Pepsico to maintain market share in developing regions.

Analyst Views & Fundamentals

The analyst consensus for Pepsico is neutral, with a simple average rating of 3.29 and a weighted performance rating of 3.49, factoring in historical accuracy. This suggests the market is cautious but not bearish.

Despite the neutral ratings, the stock is currently down -4.26% over the last five days, which does not align with the overall market expectation. This divergence hints at either a short-term correction or underperformance relative to analyst forecasts.

Key Fundamental Drivers

• ROE (diluted) growth (YoY): 13.19% (internal diagnostic score: 6.54)
• Basic EPS growth (YoY): -39.41% (internal diagnostic score: 6.54)
• Diluted EPS growth (YoY): -39.35% (internal diagnostic score: 6.54)
• Net profit growth (YoY): -39.57% (internal diagnostic score: 6.54)
• Operating cash flow growth (YoY): -24.26% (internal diagnostic score: 6.54)
• Non-current liabilities / Total liabilities: 58.06% (internal diagnostic score: 6.54)
• Current ratio: 0.78 (77.51%) (internal diagnostic score: 6.54)
• Long-term debt to working capital ratio: 6.53% (internal diagnostic score: 6.54)
• Cash-UP indicator: 62.97% (internal diagnostic score: 6.54)
• CFOA (Cash Flow from Operating Activities): 0.95% (internal diagnostic score: 6.54)

While some fundamentals, like ROE and Cash-UP, look strong, the earnings decline and cash flow contraction raise concerns about near-term performance and sustainability.

Money-Flow Trends

Pepsico is seeing divergent flows in the market. While small and medium investors are showing a positive trend (with inflow ratios of 50.85% and 50.29%, respectively), large and extra-large money flows are negative, with only 33.77% inflow from the largest funds.

The overall inflow ratio is 38.12%, suggesting that the market is not yet fully committed to a bullish stance. The block inflow ratio (36.41%) is negative, indicating that institutional investors are likely taking a cautious or defensive approach.

Key Technical Signals

From a technical standpoint, Pepsico's chart is weak, with five bearish indicators and zero bullish signals in the past five days. The internal technical score is 2.54 out of 10, clearly signaling a poor setup for new buyers.

Recent Indicators & Chart Patterns

• Marubozu White (July 22) Internal score: 1.00 (strongly bearish)
• WR Overbought (July 23 and 24) Internal score: 1.00 (bearish)
• Dividend Announcement Date (July 24) Internal score: 1.10 (bearish bias)
• MACD Death Cross (July 31) Internal score: 6.48 (mixed, but bearish in this context)

These recent signals suggest a negative momentum, with the bearish indicators clearly dominating the technical landscape.

Key insights: The “WR Overbought” and “Marubozu White” indicators are particularly concerning as they both indicate a high probability of continued downward movement. The “Dividend Announcement Date” also historically correlates with weak performance, adding to the bearish tilt.

Conclusion

Investors should be cautious with Pepsico at this time. While fundamentals and analyst views remain neutral, the technical indicators are strongly bearish, and the money flows are mixed, with large institutions pulling back.

Actionable Takeaway: Consider waiting for a clearer technical reversal before committing capital. With an internal technical score of just 2.54/10 and bearish patterns in play, now may not be the best time to chase in. Instead, monitor for a pullback or improved momentum before re-entering the stock.