PEP Stock In Spotlight As Elliott Reportedly Looks To Make Changes At PepsiCo With $4 Billion Stake

Activist investor Elliott Investment Management is reportedly planning to push PepsiCo to make changes in an attempt to boost its stock price after building a nearly $4 billion stake in the beverages and snacks company.

According to a report by The Wall Street Journal, citing people familiar with the matter, Elliott’s position in PepsiCo is one of the activist investor’s largest equity stakes ever, making it one of the beverage company’s top five active investors, excluding index funds.

The beverage and snacks giant has been grappling with slowing sales for its traditional drinks and snacks as customers become increasingly cautious about their lifestyle and food preferences. This prompted PepsiCo to acquire the probiotic soda brand Poppi.

The Wall Street Journal noted that the company’s market value has decreased to approximately $200 billion, from a peak of $270 billion in May 2023, representing a nearly 25% decline.

Retail sentiment on PepsiCo remained unchanged in the ‘bullish’ territory, with message volumes at ‘normal’ levels, according to data from Stocktwits. Shares of PepsiCo jumped over 5% in premarket trading on Tuesday.

The report added that Elliott, which has over $76 billion under management, is to have made big bets in other household names by pushing for changes. Last year, Elliott took over $5 billion stake in Honeywell and pushed for the company to split itself. Honeywell later announced the plan to break itself up.

Elliott was also involved in making changes to Starbucks’ top leadership. The coffee giant replaced its then-CEO Laxman Narasimhan with Chipotle Mexican Grill’s head, Brian Niccol, the report said. 

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