Jim Cramer Discusses These 11 Stocks & Finds Few Reasons To Sell

9. PepsiCo, Inc. (NASDAQ:PEP)

Number of Hedge Fund Holders In Q3 2024: 58

PepsiCo, Inc. (NASDAQ:PEP) is one of the biggest carbonated beverages and snack companies in the world. Its shares have lost 14.7% over the past year as rising inflation coupled with high prices has dented the demand for its products. Cramer believes that the struggles that PepsiCo, Inc. (NASDAQ:PEP) is facing are also secular instead of being purely driven by high prices. The secular trend affecting the firm is increasing health awareness among younger consumers. Here are his remarks for PepsiCo, Inc. (NASDAQ:PEP)  in detail:

“Yeah, Raymon Laguarta is doing a terrific job as CEO of Pepsi but the problem here is again, snacks. And snacks are part of either a healthy cohort, the change in people particularly younger people shifting to things that are better for you. Or it’s GLP-1 which I believe will ultimately have about forty million people on it between 12 and 13 months in persistence. We don’t know but Raymon thinks that it’s just, it’s the healthy, health is here to stay. And remember they have Frito Lays. And Frito Lay is historically salty snacks are not healthy. so they’re making smaller sizes, doing bake, they’re doing what they can, emphasizing Sabra, emphasizing a lot of different stuff that I think is good for you. But they don’t have enough that’s good for you. So, you’ll see the stock down. It’s obviously underperformed. And the question is, is it a real crisis in that they are producing food that may never be loved again. . . and we just think that the younger people don’t wanna snack the way they used.”

“Now Raymon I think can do a good job, it does yield 3.7, uh, it is historically a fantastic company as we know. It can reinvent. But it has to pivot so quickly because this is a trend, trend that came out of COVID. So COVID would come out and we’re snacking at home. And then we develop a whole new thesis about our bodies. And this is also in liquor. Liquor’s actually far worse. Diageo pulled its guidance this morning. But if you want to buy a high quality company and bet that they would figure what needs to be figured out, it is Pepsi.”