PepsiCo (PEP) Earnings Preview July 9, 2026: Analysts Cut Targets - Can $144 Hold?

TradingKey - PepsiCo (NASDAQ: PEP) is currently at $144.00, having managed to remain on its uptrending channel on the 4-hour chart, as it approaches the July 9 date for second quarter fiscal 2026 earnings. The RSI for this stock is now 64.78; however, there is still much upside to the stock in the short term, as the stock is still on a constructive trend. The stock is at 8.50% away from its 52-week low of $132.96 while still sitting 15.9% away from its 52-week high of $171.48. The stock is up just 2.45% year to date compared to the 13.8% rise in the S&P 500 this year. Prior to earnings, the likes of UBS (PT: $172), JPMorgan (PT: $170), Barclays (PT: $144), Bernstein (PT: $142) and TD Cowen (PT: $150) have been trimming their price targets. The average price target stands at $163.77, implying upside of about 14%. Analysts expect EPS to range between $2.19 and $2.21 on revenue of $24 billion. The options market is currently pricing in a 4.5% move following earnings.

Why Multiple Analysts Cut Targets Into Q2; What the Low Bar Means

The price target cuts are in light of whether Pepsi will be able to sustain the recovery seen in its North America snacks business in Q1. While Frito-Lay North America returned to a growth in volume, some analysts questioned if it would continue given the current market dynamics for consumer staples. UBS noted PepsiCo was one of its biggest underperforming consumer stocks since April and while Barclays and Bernstein stated continued pressure on PepsiCo market share in snacks and beverages. All these have weighed down on the market sentiment ahead of the earnings.

With expectations now being low, JPMorgan maintained its Overweight rating despite the target cut, citing consistent historical earnings for Pepsi and that expectations may have already priced With expectations now being low, JPMorgan maintained its Overweight rating despite the target cut, citing consistent historical earnings for Pepsi and that expectations may have already priced in channel weakness leaving room for a positive earnings surprise even if Pepsi beats modestly on the estimates. 

PepsiCo also continues to trade at ~16.3x forward earnings below the S&P 500 and consumer staplesstaples, while it has been generating robust free cash flow and has a high dividend yield. Assuming the company will continue to sustain positive earnings and demand trends with stable or expanding margins as management guides in Q2 earnings, PepsiCo will be well positioned for a relief rally.

What Investors Should Watch in PepsiCo's Q2 Earnings

There are three critical items we anticipate will move the stock on July 9:

1. First, investors will look closely at volume growth in Frito-Lay North America (PFNA). We saw volume growth improve to around 2% in Q1, and a second quarter of improvement would lend credibility to the idea that growth is on the upswing. If instead volumes contract again, it would further suggest that the Q1 increase was nothing more than an aberration.
2. Second, there is the full-year outlook. Management currently sees organic revenue growth between 2% and 4%, and a bump toward the upper end of the range would likely provide some much-needed confidence in the second-half outlook.
3. Third, keep an eye on gross margins. We'll see if commodity hedges continue to insulate us from higher input costs or, conversely, if we begin to feel the effects of both inflation and tariffs.

We will continue watching the beverage business to see how products like Pepsi Prebiotic and Lower Sugar Gatorade are impacting the business as they enter their first full quarter of sales. We expect the rest of the world to be a continued source of growth; consensus expectations for international performance remain strong in Europe, the Middle East, Africa, and Asia-Pacific.

PEP Technical Analysis: Trendline Support Holds, $151 in Focus

PEP continues to respect the rising trendline at $144 on the four-hour chart as a lower resistance channel runs along the top at $149 to $151. RSI at 64.78 is well above the midline and has not yet shown any bearish divergence. A daily close above $148.70 sets us up to move back to $151. A close below $139.20 would call into question our current bullish stance.

PepsiCo (PEP) Price Chart - Source: Tradingview

• Entry: Long above $148.70
• Target: $151.00
• Stop Loss: Close below $139.20

Catalysts

• Q2 Earnings Release: July 9 before the bell
• Consensus: EPS $2.21, Revenue $23.96B
• Options Implied Move: +/-4.46%
• Forward P/E: 16.3x vs. S&P 500 (20.8x), Consumer Staples Avg. (19.3x)

Why Have Analysts Cut PepsiCo Price Targets?

JPMorgan, UBS, TD Cowen, Barclays, and Bernstein have all lowered their price targets for PepsiCo ahead of the company's upcoming earnings on July 9. The prevailing worry is if the recovery in PepsiCo Foods North America (PFNA) can be sustained, particularly after the first quarter marked the first time in a few quarters that the segment posted positive volume growth. In a report published on Wednesday, UBS remarked that PepsiCo has been among its poorest-performing consumer stocks since April and wondered if Frito-Lay North America is able to regain its long-term rate of growth. Concerns over demand and market share were also cited by both Barclays and Bernstein.

What Is the 'Low Bar' Thesis?

Even as it lowered its price target, JPMorgan retained an Overweight rating on the stock as it believes expectations may be overly pessimistic. PepsiCo has had a track record of modestly outperforming earnings. Given the weaker channel data and recent target cuts, the bar for an upside surprise may be lower than usual.

PEP stock also changes hands at 16.3 times next year's earnings, a multiple that is below the S&P 500 and its staples peers, which could provide additional cushion if PepsiCo delivers a flat to mildly positive print.

The headline figure will be PFNA volume growth. A second successive quarter of positive volumes would bolster the narrative of recovering demand and raise confidence in the company's full year forecast, while another quarter of negative volumes would confirm the idea that the first quarter was a blip. 

Investors will also keep a close eye on updated full year guidance and gross margins as a means of gauging whether PepsiCo can maintain its pricing power even as the company grapples with elevated raw materials and tariff costs.

Bottom Line

PepsiCo takes on earnings next month after a stream of analyst price target slashes and months of relative underperformance has reset expectations. The major question that will hang over the report is whether it is possible for PFNA to sustain recovery. From a technical standpoint, PEP is currently maintaining support near $144.00. A decisive close above $148.70 would help to bolster the bull case and point towards $151.00, while a close below $139.20 would put the uptrend in jeopardy. The valuation case is still supportive, but a July 9 earnings outcome will determine whether better fundamentals can lead to a longer-term rebound.