PepsiCo's Wall Street Reckoning: JPMorgan and Deutsche Bank Slash Targets as North America Stalls
Published on 09/30/2026 at 06:50 | Editorial boerse-global.de
Two of the Street's heavyweight banks delivered a one-two punch to PepsiCo this week, with JPMorgan yanking its rating to Neutral from Overweight on Tuesday and Deutsche Bank following suit a day earlier by downgrading the snack-and-beverage giant to Hold from Buy. Both houses pointed to the same culprit: a North American food business that refuses to bounce back.
JPMorgan's move came with a steep cut to its price target, slashing it to $138 from $170. Deutsche Bank, for its part, trimmed its objective to $138 from $155. TD Cowen also weighed in on Monday, keeping its Hold rating but pulling its target down to $133 from $145. The clustering of revisions has left analysts' target range noticeably tighter than before.
A Stock Hugging Its Yearly Low
The market's response has been muted but telling. PepsiCo shares traded at EUR 113.16 on Tuesday, eking out a gain of just 0.09% on the day. That leaves the stock roughly 22% below its 52-week high of EUR 144.88. The picture darkens further when viewed over a longer horizon: since the start of the year, the shares have shed 7.4%.
JPMorgan's analysts see mounting obstacles for the Purchase, New York-based company. The sluggish recovery in North American demand is the primary worry. To hit its targeted earnings growth of 5% to 7% per share, PepsiCo will likely need to lean heavily on cost-cutting programs in the fourth quarter of 2026.
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Forecasts Trimmed Across the Board
The bank didn't stop at the rating change. JPMorgan revised its own estimates downward in a meaningful way. For fiscal 2027, it now projects earnings per share of just $8.86, down from a prior estimate of $9.05. The market consensus sits at $8.95. Looking further out to 2028, the house cut its forecast to $9.33 per share from $9.57, which also lands below the consensus estimate of $9.47.
Those reductions reflect a broader loss of confidence on Wall Street. Deutsche Bank's downgrade was driven by diminished faith in a sustained rebound for the North American food division, while TD Cowen's adjustment signaled similar doubts about earnings momentum in the US business.
The Pricing Conundrum
Behind the gloomy analyst sentiment lies a persistent struggle with pricing power. Roughly a week ago, reports surfaced that PepsiCo plans to raise prices on select sodas, chips, and dips. The planned increases, set to take effect in late 2026 or early 2027, represent a strategic pivot for the company. Earlier price cuts failed to deliver the hoped-for boost in customer demand.
The new hikes, expected in the low-to-mid single-digit percentage range for snack brands including Doritos and Ruffles, are designed to shore up margins against ongoing cost pressures. Whether consumers will absorb them is another question entirely.
Eyes on the October Print
For investors, the key test comes on October 8, when PepsiCo reports third-quarter 2026 results before the opening bell. Market participants are counting on those figures to provide a clear read on how the North American food business has actually performed. The report could determine whether the stock can halt its downward drift or whether further pain lies ahead.
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A Billion-Dollar Bet South of the Border
While the home market sputters, PepsiCo is pressing ahead with international expansion. On September 27, Colombian President Abelardo de la Espriella announced that the company intends to invest $1 billion in the country over the next five years. The funds are earmarked for expanding local production, modernizing facilities, and building a more robust distribution network. According to the Colombian head of state, the initiative will involve more than 2,000 farmers.
Specifics remain scarce, however. Details on exact regions, the precise timeline, and the number of new jobs have yet to be disclosed. Whether the push into emerging markets can offset the drag from North America is the question now dominating investor attention.
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