We recently published an article titled, 11 Stocks on Jim Cramer’s Radar Right Now. In this article, we are going to take a look at where PepsiCo, Inc. (NASDAQ:PEP) stands against other stocks on Jim Cramer’s radar right now.

In his recent episode of Mad Money, host Jim Cramer focused on the upcoming market events, emphasizing the importance of new consumer price index data alongside a series of reports as the earnings season kicks off.

Cramer pointed out that the Labor Department’s nonfarm payroll report revealed significant job growth in September, surpassing expectations. He highlighted the significant rally in stocks on Friday, a response to better-than-expected job creation figures. The U.S. economy added 254,000 jobs in September, significantly exceeding Wall Street’s estimate of 150,000. Additionally, there were upward revisions for the previous two months, with 72,000 more jobs reported for July and August combined.

Despite his initial expectation that stocks would decline as bond yields surged, Cramer noted the resilience in the market. He observed that people seemed to feel relief, thinking that a major economic downturn was not on the horizon, which prompted a flurry of buying activity in the stock market. He added, “Maybe we aren’t headed toward a landing at all.” He described the situation as quite unusual and, in his view, “quite exciting”.

He mentioned that on Wednesday, the Federal Open Market Committee will publish notes from its last month’s meeting, which could clarify the central bank’s bold choice to cut interest rates by 50 basis points. According to Cramer, Wall Street is rife with speculation about the Federal Reserve’s future actions, especially following strong labor statistics released last Friday. As speculation swirls around whether the next cut will be 25 or 50 basis points, Cramer leaned towards the belief that it would likely be 25 or nothing at all. He added:

“Then again, what really matters is the overall direction for rates, and that direction is most definitely lower, which is bullish for stocks.”

He also mentioned that Friday would bring the producer price index report, which, like the consumer price index, will serve as a critical indicator for the Fed’s upcoming decisions. Cramer commented:

“Here’s the bottom line: a market that appreciates good news, like a robust job creation number, is a market that can handle, well, let’s just say, the historically tough month of October. After today’s performance, all I can say is so far so good.”

Our Methodology

For this article, we compiled a list of 11 stocks that were mentioned by Jim Cramer during his episode of Mad Money on October 4. We listed the stocks in ascending order of their hedge fund sentiment as of the second quarter, which was taken from Insider Monkey’s database of more than 900 hedge funds.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).

PepsiCo, Inc. (NASDAQ:PEP)

Number of Hedge Fund Holders: 65

PepsiCo, Inc. (NASDAQ:PEP) is a prominent global company engaged in the production and sale of beverages and convenient foods. The product range offered by the company is vast, including snacks such as chips and dips, cereals, and various side dishes. The beverage selection includes ready-to-drink teas, coffees, juices, and even alcoholic beverages marketed under the Hard MTN Dew brand. Popular brands like Lay’s, Doritos, Gatorade, and Pepsi-Cola highlight the company’s ability to appeal to a wide range of tastes and preferences.

Mentioning the company’s upcoming earnings release, Cramer said:

“Tuesday marks the beginning of earning season when PepsiCo reports before the open. Now, this reliable food and beverage stock has been hit with multiple price target cuts, okay. But maybe that’s put a lid on expectations to the point where the stock can stabilize on somewhat in-line results. By the way, it doesn’t hurt that PepsiCo sports a 3.2% yield, which is pretty darn good, especially as long as treasury yields stop going higher. It sure is tempting.”

Although PepsiCo (NASDAQ:PEP) may currently face challenges in the market, its strengths in supply chain management, marketing, and distribution provide a significant advantage in both growing existing brands and pursuing innovative opportunities or acquisitions. Additionally, it has established itself as a Dividend King, having consistently paid and increased its dividends for over 50 years.

On October 1, PepsiCo (NASDAQ:PEP) announced a definitive agreement to acquire Garza Food Ventures LLC, known as Siete Foods, for $1.2 billion. Through the acquisition, it seeks to advance the company’s portfolio by integrating an authentic Mexican-American brand and expanding its offerings of better-for-you food products. The transaction is expected to be finalized in the first half of 2025.

Overall, PEP ranks 7th on our list of stocks on Jim Cramer’s radar right now. While we acknowledge the potential of PEP as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than PEP but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.