PepsiCo Stock Brushes Off Pre-Earnings Bull Note

Deutsche Bank raised the equity’s price target to $178 from $175

The shares of PepsiCo, Inc. (NASDAQ:PEP) are down 0.5% to trade at $169.81 at last check, despite Deutsche Bank earlier raising the equity’s price target to $178 from $175. This bull note came just ahead of the beverage name’s second-quarter earnings report, which is due out before the open on Tuesday, July 12. Below, we will check in on PEP’s recent chart activity, and see how the security usually performs after stepping into the earnings confessional. 

The first half of the year was volatile for PepsiCo stock. A ceiling at the $172 level turned down the security’s pop yesterday, after stifling its May rally. Shares have been climbing from their lowest level since March, though, and are today pacing for their fifth-straight close above the 40-day moving average. Year-over-year, PEP sports a 13.2% lead.

PEP 40 Day

In terms of post-earning activity, PepsiCo stock has finished five of eight next-day sessions higher in the past two years, including a 2.3% jump in July 2021. Options traders are pricing in a 3% swing for PEP after earnings this time around,  regardless of direction, which is higher than the 1.1% move it averaged after its last eight reports.  

Short-term options traders are bullish towards the stock. This is per PEP’s Schaeffer’s put/call open interest ratio (SOIR) of 0.75, which sits in the low 4th percentile of annual readings. 

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