PepsiCo shares have dropped 10% in 2026 even as the S&P 500 climbed 13%, but the sharper contrast is with rival Coca-Cola, which is up nearly 25% over the same stretch. That gap is likely tied to Coca-Cola outgrowing PepsiCo on organic sales.
PepsiCo stock has fallen 10% so far in 2026, while the S&P 500 index has gained 13% over the same period. The stock has also dropped 33% from its 2023 high as of this writing. Investors have punished the shares, but the comparison that matters most is not to the index.
Coca-Cola outgrows PepsiCo on sales
PepsiCo competitor Coca-Cola has risen nearly 25% in 2026, and the underlying business trends explain why. In the second quarter of 2026, PepsiCo's organic sales rose 2.4%, down from 2.6% in the first quarter. Coca-Cola, by contrast, posted 6% organic sales growth in the second quarter, down from 10% in the first quarter but still well ahead of PepsiCo. The real reason PepsiCo is falling behind the S&P 500 is likely that it is falling behind Coca-Cola from a business perspective, and investors are simply reacting to that dynamic.
Consumer staples face headwinds
The consumer staples sector is working through material headwinds. Inflation is increasing operating costs, consumers are tightening their belts, and tastes are shifting in a healthier direction, which weighs on snack makers and packaged food companies like PepsiCo. PepsiCo isn't doing badly, but it isn't doing particularly well either.
Dividend King status still draws income investors
PepsiCo remains a Dividend King, with over 50 consecutive annual dividend increases. The sell-off has also left the stock with a historically high 4.5% yield. Despite the weak performance, the company remains financially strong and highly profitable, with a market cap of $176 billion and leading positions in beverages, salty snacks, and packaged food. If you think in decades rather than days, PepsiCo could still be an attractive choice for more adventurous investors.
Source: The Motley Fool
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