Andy Morton

US: PepsiCo puts portfolio at risk with new sweetener - analyst

By | 22 February 2013

PepsiCo announced the sweetener developments last week

PepsiCo announced the sweetener developments last week

PepsiCo's new sweetener innovation may damage the company's existing portfolio of low- and no-calorie beverages, an analyst has warned.

Wells Fargo said yesterday (21 February) that it remained “ cautious” over recently-announced sweetener developments as cannibalisation could outweigh gains. “We think many factors need to be considered including ultimate positioning of this sweetener,” the analyst said.

Wells Fargo said that while it was encouraged by PepsiCo's innovation focus, “time will tell” if it can revitalise PepsiCo's CSD category.

Wells Fargo's comments came after PepsiCo's presentation at the Consumer Analyst Group of New York conference yesterday during which PepsiCo CFO Hugh Johnston said the new sweetener, announced last week, will be “more evolutionary than revolutionary”.

Analyst CSLA said after the conference that PepsiCo will remain its top beverage pick for investors as the company's productivity drives and “new culture of savings” will continue to boost margins. PepsiCo doubled its productivity savings last year, CSLA said.  

Expert analysis

How Will Stevia Change the Sweeteners Market?

Stevia’s arrival in the international sweeteners market is almost certain to shake up the entire area of sugar replacement, but the big question is whether it will erode volumes of existing high-intensity sweeteners or will settle comfortably alongside them with its broader focus on balanced wellness rather than dieting. In order to answer that question, this report explores the background, current status and future directions for stevia sweeteners.

Sectors: Soft drinks

Companies: PepsiCo

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US: PepsiCo puts portfolio at risk with new sweetener - analyst

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