PepsiCo (PEP) is expected to see another year of price-led revenue growth in 2024 after delivering an earnings beat amid a challenged market backdrop in Q3 of 2023, Wedbush said in a note to clients Wednesday.
The investment firm kept its outperform rating and $195 price target on the company.
The beverage company issued a preliminary outlook for 2024, implying a revenue growth of 5% and per-share earnings growth of 8%, according to the note.
“While expectations were for volume to become a more meaningful contributor to topline growth as trends normalize, a move towards portion control and smaller pack sizes will likely result in another year of price-led revenue growth,” Wedbush analysts said.
Wedbush adjusted its 2023 estimates to EPS of $7.54 from $7.47 and to revenue of $91.68 billion from $91.81 billion. For 2024, it raised its forecast to EPS of $8.08 from $7.96 and to revenue of $95.90 billion from $95.31 billion.
Meanwhile, Wedbush said it is “way too early” to evaluate the impact of GLP-1, or weight loss, drugs on volume consumption.