5 Consumer Staples Stocks To Buy According To Billionaire Ray Dalio

2. PepsiCo, Inc. (NASDAQ:PEP)

Bridgewater Associates’ Stake Value: $530,141,000

Percentage of Bridgewater Associates’ 13F Portfolio: 3.08%

Number of Hedge Fund Holders: 60

PepsiCo, Inc. (NASDAQ:PEP) is an American multinational beverage manufacturer and distributor that has featured on Ray Dalio’s portfolio since Q3 2020. As of the end of the December quarter of 2021, Ray Dalio’s fund owns over 3 million PepsiCo, Inc. (NASDAQ:PEP) shares, worth $530.1 million. The stock accounts for 3.08% of the fund’s total Q4 holdings. 

On March 8, PepsiCo, Inc. (NASDAQ:PEP) became another consumer staples manufacturer that is looking for options for its Russian division. The company is possibly looking at writing off the value of the unit, but it is a complex matter since the operations in Russia are too large to be closed down entirely, and the region is the third largest contributor to PepsiCo, Inc. (NASDAQ:PEP)’s revenue. However, PepsiCo, Inc. (NASDAQ:PEP) will have to divest its Russian business if the war does not come to an end and institutional investors pressure the company to follow the footsteps of McDonald’s and Coca Cola.

Wells Fargo analyst Chris Carey lowered the price target on PepsiCo, Inc. (NASDAQ:PEP) to $170 from $175 and kept an Equal Weight rating on the shares on March 9. PepsiCo, Inc. (NASDAQ:PEP)’s asset portfolio is top-quality, but the analyst believes that consensus and guidance feels high, even after accounting for higher pricing and savings versus PepsiCo, Inc. (NASDAQ:PEP)’s guidance for the future. 

Fundsmith LLP is the largest shareholder of PepsiCo, Inc. (NASDAQ:PEP), with 10.4 million shares worth $1.80 billion. Overall, 60 hedge funds were bullish on PepsiCo, Inc. (NASDAQ:PEP) at the end of December 2021. 

Here is what Saturna Capital Amana Funds has to say about PepsiCo, Inc. (NASDAQ:PEP) in its Q4 2021 investor letter:

“Given the likelihood of rising inflation and interest rates ahead, we anticipate adjustments to the portfolio to reduce exposure to highly valued stocks dependent on low interest rates to support terminal year valuations, while seeking investments in companies more correlated with a return to economic normalcy. We sold our positions in Pepsi. We believe Pepsi to be a well-run firm, but its products are not in keeping with an ESG mandate. Additionally, it has entered a joint venture to produce and distribute alcoholic beverages, making it ineligible for the portfolio.”