PepsiCo Investors Brace for Earnings Amid Regulatory Scrutiny

PepsiCo finds itself at a critical juncture, with market participants awaiting a key quarterly report while a dormant regulatory issue resurfaces in the political arena. The focus for shareholders is twofold: assessing the company's fundamental operational performance and evaluating the potential reputational impact from renewed political attention.

All eyes are on the scheduled release of PepsiCo's fourth-quarter financial results on February 3. Trading activity has been muted in anticipation, reflecting a market in wait-and-see mode. Analyst sentiment presents a mixed picture. While BNP Paribas maintained an Outperform rating in mid-January with a price target of $179, and Citigroup sees the stock reaching $170, other voices express caution. UBS has tempered expectations, suggesting the upcoming Q4 figures could prove "unspectacular," highlighting lingering skepticism among some investors despite the company's defensive business model.

The stock's recent performance underscores the significance of the upcoming report. Over the past 30 days, PepsiCo shares have declined by approximately 15%, making the earnings release a crucial near-term milestone for market direction.

Regulatory Concerns Resurface

Adding a layer of complexity is renewed political scrutiny from Washington. On January 28, it was reported that Senator Elizabeth Warren, alongside other Democratic lawmakers, has pressed the Federal Trade Commission (FTC) for details regarding its decision to drop a lawsuit against PepsiCo in May 2025.

The original case centered on allegations that the company engaged in preferential pricing for large retailers such as Walmart. Although the legal proceeding concluded months ago, the fresh political inquiry has the potential to reignite reputational concerns, creating an overhang that could persist beyond the earnings announcement.

Should investors sell immediately? Or is it worth buying Pepsi?

Dividend Appeal and Shifting Institutional Holdings

For a significant portion of the investment community, PepsiCo's dividend remains a cornerstone of its appeal. The company distributes a quarterly payment of $1.4225 per share, which annualizes to $5.69. Based on the referenced price level, this equates to a yield of roughly 3.8%.

Recent regulatory filings reveal divergent moves among major institutional investors during the third quarter of 2025:
* Core Alternative Capital drastically reduced its stake, selling off over 86% of its holdings.
* In contrast, Truist Financial made only a modest 1.1% reduction in its position, maintaining an investment valued at over $155 million.

Strategic Initiatives and Competitive Landscape

On the strategic front, PepsiCo continues to execute on long-term plans. A 10-year agreement with Engie to supply biomethane for its UK operations, commencing in 2027, aligns with broader sustainability goals but is not expected to impact near-term cash flows. Meanwhile, competition in the away-from-home channel is intensifying. Reports indicate that Coca-Cola has regained control of the food court beverage operations at Costco locations across the United States.

The February 3, 2026 earnings release will provide the next substantive data point for investors. This will be accompanied by watchfulness for any formal response from regulators to the FTC inquiry. Together, these elements are poised to set the narrative for the coming weeks: one driven operationally by financial results, and another shaped by the potential for regulatory headlines.