This week, five of the portfolio holdings ranked in the Top 10.
| Ticker | Account Value |
| BDX | 3,507.40 |
| FMCB | 4,107.04 |
| HTO | 3,340.29 |
| PPG | 3,420.45 |
| SCL | 3,211.64 |
The lowest amount belongs to SCL. However, there exists a position imbalance such that only EPD, FRT, and UHT are eligible for additional investment. Unfortunately, none of these have performed so poorly, relative to expectations, that they ranked in the Top 10. It can only mean one thing.
It is time to add a new position to the Portfolio for the Ages!
PEPSICO Inc
Here is the profile from Schwab:
PepsiCo, Inc. engages in the manufacture, marketing, distribution, and sale of various beverages and convenient foods worldwide. The company operates through seven segments: Frito-Lay North America; Quaker Foods North America; PepsiCo Beverages North America; Latin America; Europe; Africa, Middle East and South Asia; and Asia Pacific, Australia and New Zealand and China Region. It provides dips, cheese-flavored snacks, and spreads, as well as corn, potato, and tortilla chips; cereals, rice, pasta, mixes and syrups, granola bars, grits, oatmeal, rice cakes, and side dishes; beverage concentrates, fountain syrups, and finished goods; ready-to-drink tea, coffee, and juices; dairy products; and sparkling water makers and related products, as well as distributes alcoholic beverages under Hard MTN Dew brand. The company offers its products primarily under the Lay’s, Doritos, Fritos, Tostitos, BaiCaoWei, Cheetos, Cap’n Crunch, Life, Pearl Milling Company, Gatorade, Pepsi-Cola, Mountain Dew, Quaker, Rice-A-Roni, Aquafina, Bubly, Emperador, Diet Mountain Dew, Diet Pepsi, Gatorade Zero, Crush, Propel, Dr Pepper, Schweppes, Marias Gamesa, Ruffles, Sabritas, Saladitas, Tostitos, 7UP, Diet 7UP, H2oh!, Manzanita Sol, Mirinda, Pepsi Black, Pepsi Max, San Carlos, Toddy, Walkers, Chipsy, Kurkure, Sasko, Spekko, White Star, Smith’s, Sting, SodaStream, Lubimyj Sad, Agusha, Chudo, Domik v Derevne, Lipton, and other brands. It serves wholesale and other distributors, foodservice customers, grocery stores, drug stores, convenience stores, discount/dollar stores, mass merchandisers, membership stores, hard discounters, e-commerce retailers and authorized independent bottlers, and others through a network of direct-store-delivery, customer warehouse, and distributor networks, as well as directly to consumers through e-commerce platforms and retailers. The company was founded in 1898 and is based in Purchase, New York.
First, I like the logo – a bold font and carefully placed, curved lines of various colors trick our mind into seeing a globe.
Second, the profile clearly drives home the point that all they sell is Pepsi. I kid. They certainly have many delicious products for humanity. But really, who’s gonna turn down a Pepsi? It’s sweet. It’s bubbly. It’s delicious. It’s very refreshing.
The Details
Data as of 2025-09-27
| Name | PepsiCo Inc |
| Ticker | PEP |
| Website | Investor Relations |
| Sector | Consumer Staples |
| Dividend Streak | 53 years |
| Last Price | $140.44 |
| Div Amt (quarterly) | $1.4225 |
| Ann Dividend | $5.69 |
| Last Ann Div Inc | 6.6% |
| Dividend Yield | 4.1% |
| Payout Ratio (ttm) | 69.7% |
| Beta (5-yr, mon) | 0.45 |
| P/E Ratio (ttm) | 17.84 |
Reasons to Invest
Let’s start off with a recent opinion from CFRA in their stock report from 2025-09-27:
Our Buy opinion reflects our view that PEP is a higher-quality, low-beta, blue-chip company with a strong balance sheet and high degree of earnings stability. We also like the power of its various brands, such as Frito-Lay, Gatorade, Pepsi, and Mountain Dew, as we believe they give the company the ability to successfully pass through higher costs to consumers in the form of price increases. In the longer term, we see faster-growing international markets and the Frito-Lay business as the primary growth drivers. PEP’s focus on healthier snacks and beverages will also continue to drive the top line, in our view.
CFRA has a 12-month target of $170.00.
Morningstar has a fair value of $177.37.
2025H1 EPS of $3.60 has fallen off from the same period of the prior year by -7.5% and the market couldn’t quite hack it. In fact, it is eerily similar to the 2023H1 EPS of $3.59, which shortly after that year’s second quarter earnings were announced, the stock traded at an all-time high of $196.88.
It’s funny that not too long ago EPS over the first half of the year of $3.59 was enough to juice the stock price within spitting distance of $200, but now it isn’t enough to warrant $145. The P/E ratio of 17.84 is at the lower end of the range of where PEP has traded over the last 16 years.
Prior to this year, a 4% yield was unheard of, and it is by no means unsafe. The chart below illustrates that even at 4% the dividend is still well supported by a 70% payout ratio.
It may be years before PEP returns to the $190s or higher, but this is a chance to add a solid earner, paying a strong dividend, at a time when there is more upward potential then down. A $1,000 position is not enough to throw the portfolio back into balance, but it is a start.
I will be acquiring 7 shares of PEP on Monday morning. We may even add to the position one more time before the next earnings announcement is made.