Shares of PepsiCo Inc. ($PEP) fell more than 5% on Tuesday, after the company missed revenue estimates for the fourth quarter, but retail sentiment stayed bullish.

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Pepsi’s earnings per share came in at $1.96, above consensus estimates of $1.94. Its revenues, however, stood at $27.8 billion, missing estimates of $27.9 as quoted by Wall Street analysts, Fly.com reported.

Pepsi’s Frito-Lay North America’s volume fell 3% with ongoing higher food prices and consumers watching grocery budgets, Fly.com reported. While operating profit decreased 11% in the division.

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"Our businesses remained resilient in 2024, despite subdued category performance trends in North America, the continued impacts related to a recall in our Quaker Foods North America division and business disruptions due to geopolitical tensions in certain international markets,” said chairman and CEO Ramon Laguarta. "Looking ahead to 2025, we will continue to build upon the successful expansion of our international business, while also taking actions to improve performance in North America.”

Pepsi said it hopes to deliver low-single-digit organic revenue growth and mid-single-digit core constant currency EPS growth in 2025. It also announced a 5% increase in its annualized dividend per share beginning with the June 2025 payment.

Sentiment on Stocktwits was ‘bullish’ compared to ‘neutral’ a week ago with users hopeful about a rebound. Message volumes climbed into the ‘extremely high’ zone.

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Screenshot 2025-02-05 at 2.45.11 PM.png — PEP sentiment meter and message volumes on Feb 5

On Tuesday, Morgan Stanley lowered the firm's price target to $168 from $185 with an ‘Equal Weight’ rating, noting muted organic sales growth with lingering North America softness, Fly.com reported.

According to the firm, the reduced price target fits PepsiCo's worsening U.S. market share trends and the potential need to fund additional investment, added the report.

Pepsi stock is down 5.6% year-to-date.

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