Engaged Capital Nominates Two Highly Qualified, Independent Candidates for Election to Portillo's Board of Directors
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Mar 03 2025
0mins
Should l Buy PEP?
Source: Newsfilter
Board Nominations: Engaged Capital has nominated Charlie Morrison and Nicole Portwood for election to the Board of Directors of Portillo's Inc. at the 2025 Annual Meeting, citing their extensive experience in restaurant operations and marketing as essential for improving company performance.
Company Challenges: Despite Portillo's strong brand and growth potential, the company is facing issues such as outdated operations and ineffective marketing, which Engaged Capital believes can be resolved through strategic leadership changes and targeted initiatives.
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Analyst Views on PEP
Wall Street analysts forecast PEP stock price to fall
12 Analyst Rating
6 Buy
6 Hold
0 Sell
Moderate Buy
Current: 169.740
Low
144.00
Averages
161.90
High
172.00
Current: 169.740
Low
144.00
Averages
161.90
High
172.00
About PEP
PepsiCo, Inc. is a global beverage and convenient food company. The Company’s segments include PepsiCo Foods North America (PFNA), PepsiCo Beverages North America (PBNA), International Beverages Franchise (IB Franchise), Europe, Middle East and Africa (EMEA), Latin America Foods (LatAm Foods), and Asia Pacific Foods. PFNA segment includes all of its convenient food businesses in the United States and Canada. PBNA segment includes all of its beverage businesses in the United States and Canada. IB Franchise segment includes its international franchise beverage businesses, as well as its SodaStream business. EMEA segment includes its convenient food businesses and beverage businesses with Company-owned bottlers in Europe, the Middle East and Africa. LatAm Foods segment includes all of its convenient food businesses in Latin America. Asia Pacific Foods segment consists of its convenient food businesses in Asia Pacific, including China, Australia and New Zealand, as well as India.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
PepsiCo's Poppi Brand Continues Strong Growth Post-Acquisition
- Brand Growth Momentum: Since PepsiCo's $1.95 billion acquisition of Poppi on March 17, 2025, the brand has shown strong growth momentum, with explosive sales expected from 2020 to 2024, solidifying its position in the functional beverage market.
- Market Expansion Plans: Poppi is set to launch in the UK at Tesco and Pret A Manger on March 5, 2026, marking its second international market after Canada, with rapid market share growth anticipated through PepsiCo's distribution network.
- Channel Diversification: Poppi's sales channels have expanded to thousands of retailers, including Whole Foods, Target, and Walmart, demonstrating strong market penetration in the U.S., Canada, and Mexico, which enhances brand visibility and consumer acceptance.
- Strategic Significance: This acquisition not only strengthens PepsiCo's beverage portfolio but also supports its “positive choices” growth strategy by introducing a low-sugar, gut-health-focused functional beverage, thereby enhancing the brand's competitive edge in the market.
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- Revenue Growth Slowdown: Beyond Meat experienced a staggering 239% revenue growth in 2019, but this plummeted to just 37% in 2020 due to the pandemic, as consumers shifted back to cheaper animal-based meats, severely impacting market performance.
- Significant Margin Decline: The company's gross margin has drastically fallen from 33.5% in 2019 to 12.8% in 2024 due to inventory liquidation and increased competition, which not only affects profitability but also exacerbates financial pressures.
- Increased Share Dilution: Since its IPO, Beyond Meat has increased its outstanding shares by 678%, a trend that is likely to continue, further diluting shareholder value and complicating recovery efforts.
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- Put Option Appeal: The current bid for the $165.00 put option is $9.80, and if an investor sells this option, they commit to buying the stock at $165.00, effectively lowering their cost basis to $155.20, which is about a 2% discount from the current price of $168.95, making it attractive for potential PEP buyers.
- Yield Potential Analysis: Should the put option expire worthless, the investor could realize a 5.94% return, or an annualized yield of 8.24%, referred to as YieldBoost, highlighting the strategy's potential appeal.
- Call Option Returns: The $170.00 call option has a current bid of $11.10, and if an investor buys PEP shares at $168.95 and sells this call option, they could achieve a total return of 7.19% if the stock is called away at expiration.
- Risk-Reward Trade-off: The $170.00 call option has a 47% chance of expiring worthless, in which case the investor retains both the stock and the premium collected, enhancing their return by an additional 6.57%, with an annualized yield of 9.12%.
See More
PepsiCo's Poppi Brand Continues Strong Growth Post-Acquisition
- Brand Growth Momentum: Since PepsiCo's $1.95 billion acquisition of Poppi on March 17, 2025, the brand has shown strong growth momentum, with explosive sales expected from 2020 to 2024, solidifying its position in the functional beverage market.
- Market Expansion Plans: Poppi is set to launch in the UK at Tesco and Pret A Manger on March 5, 2026, marking its second international market after Canada, with rapid market share growth anticipated through PepsiCo's distribution network.
- Channel Diversification: Poppi's sales channels have expanded to thousands of retailers, including Whole Foods, Target, and Walmart, demonstrating strong market penetration in the U.S., Canada, and Mexico, which enhances brand visibility and consumer acceptance.
- Strategic Significance: This acquisition not only strengthens PepsiCo's beverage portfolio but also supports its “positive choices” growth strategy by introducing a low-sugar, gut-health-focused functional beverage, thereby enhancing the brand's competitive edge in the market.
See More
Four Boring Dividend Stocks for Long-Term Income
- Procter & Gamble's Edge: Procter & Gamble (PG) holds approximately 40% of the U.S. laundry detergent market and nearly 50% of the diaper market, leveraging scale and market dominance to maintain low per-unit production costs and high pricing power, ensuring stable cash flow and dividend payments.
- Brookfield Asset Management: Brookfield Asset Management (BAM) focuses on industries with long-term growth potential, including infrastructure and renewable energy, with a projected revenue and dividend growth target of 15%-20%, appealing to income-seeking investors.
- Automatic Data Processing's Resilience: Automatic Data Processing (ADP) is more than just a payroll processor, offering services like employee attendance and benefits management; despite AI challenges, its 51-year streak of dividend increases demonstrates its business resilience and sustainability.
- Coca-Cola's Stability: Coca-Cola (KO) has raised its per-share dividend for 64 consecutive years, relying on a strong brand portfolio and outsourcing bottling operations to reduce cost risks, allowing it to focus on brand marketing and continue providing stable income for investors.
See More
Stable Dividend Growth and AI Opportunities
- Importance of Dividend Growth: Over time, dividend growth becomes more meaningful than the yield at the time of purchase, especially for income-seeking investors, as holding dividend stocks long-term can yield substantial returns.
- Procter & Gamble's Market Dominance: Procter & Gamble's Tide laundry detergent holds approximately 40% of the U.S. market, while Pampers controls nearly 50%, providing the company with significant advantages in pricing power and production cost control, further solidifying its leadership in the consumer goods sector.
- Brookfield Asset Management's Growth Potential: Brookfield focuses on industries with high long-term growth potential, with a quarterly per-share dividend increase of 15% from 2025, and a long-term revenue and dividend growth target of 15% to 20%, indicating a strong market outlook.
- Coca-Cola's Stability: Coca-Cola has raised its per-share dividend for 64 consecutive years, and while its forward-looking yield is 2.6%, the dividend has grown nearly 90% over the past decade, demonstrating its ability to maintain strong market performance amid changing consumer preferences.
See More
Dividend Stocks Surge Amid Market Volatility, Outperforming S&P 500
- Dividend Stocks Performance: In 2026, dividend aristocrats are outperforming the broader market, with the ProShares S&P 500 Dividend Aristocrats ETF up 10% year-to-date compared to less than 1% for the S&P 500, reflecting investors' preference for stable income amid market volatility.
- Coca-Cola Dividend Increase: Coca-Cola announced a 4% increase in its quarterly dividend to 53 cents per share in February, marking its 64th consecutive year of dividend growth, and returned $8.8 billion to shareholders last year, demonstrating strong cash flow and market stability.
- NextEra Energy's Growth Plans: NextEra Energy raised its quarterly dividend by 10% to about 62 cents per share and plans for 10% annual dividend growth through 2026, with ambitions to add 30 gigawatts of new generation capacity by 2035, showcasing its commitment to renewable energy.
- Abbott Laboratories' Sustained Growth: Abbott announced a 6.8% dividend increase to 63 cents per share in December, achieving 54 consecutive years of growth, and despite missing fourth-quarter revenue expectations, its dividend growth of over 70% reflects strong profitability and market confidence.
See More
Analysis of Beyond Meat's Stock Price Collapse
- Revenue Growth Slowdown: Beyond Meat experienced a staggering 239% revenue growth in 2019, but this plummeted to just 37% in 2020 due to the pandemic, as consumers shifted back to cheaper animal-based meats, severely impacting market performance.
- Significant Margin Decline: The company's gross margin has drastically fallen from 33.5% in 2019 to 12.8% in 2024 due to inventory liquidation and increased competition, which not only affects profitability but also exacerbates financial pressures.
- Increased Share Dilution: Since its IPO, Beyond Meat has increased its outstanding shares by 678%, a trend that is likely to continue, further diluting shareholder value and complicating recovery efforts.
- Uncertain Future Outlook: Although Beyond Meat aims to stabilize its business through portfolio streamlining and price increases, analysts predict a 1% revenue decline in 2026 and only a 1% increase in 2027, highlighting the ongoing challenges the company faces.
See More
PepsiCo Options Trading Analysis
- Put Option Appeal: The current bid for the $165.00 put option is $9.80, and if an investor sells this option, they commit to buying the stock at $165.00, effectively lowering their cost basis to $155.20, which is about a 2% discount from the current price of $168.95, making it attractive for potential PEP buyers.
- Yield Potential Analysis: Should the put option expire worthless, the investor could realize a 5.94% return, or an annualized yield of 8.24%, referred to as YieldBoost, highlighting the strategy's potential appeal.
- Call Option Returns: The $170.00 call option has a current bid of $11.10, and if an investor buys PEP shares at $168.95 and sells this call option, they could achieve a total return of 7.19% if the stock is called away at expiration.
- Risk-Reward Trade-off: The $170.00 call option has a 47% chance of expiring worthless, in which case the investor retains both the stock and the premium collected, enhancing their return by an additional 6.57%, with an annualized yield of 9.12%.
See More
