Clearbridge Value Strategy Exited Its Position in PepsiCo (PEP)

ClearBridge Investments, an investment management company, released its “ClearBridge Value Strategy” second quarter 2025 investor letter. A copy of the letter can be downloaded here. The investment landscape appears thriving on the surface but chaotic underneath due to geopolitical tensions, deglobalization, rising debt, and supply chain disruptions. Although nominal growth is accelerating, it also brings greater volatility and unpredictability. The ClearBridge Value Strategy outperformed its Russell 1000 Value Index benchmark in the second quarter in a subdued period for value stocks. Overall stock selection contributed to the strategy’s performance in the quarter, while overall sector allocation detracted. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its second quarter 2025 investor letter, ClearBridge Value Strategy highlighted stocks such as PepsiCo, Inc. (NASDAQ:PEP). PepsiCo, Inc. (NASDAQ:PEP) is an American multinational company that manufactures, markets, and distributes various beverages and convenient foods. The one-month return of PepsiCo, Inc. (NASDAQ:PEP) was 1.65%, and its shares lost 17.97% of their value over the last 52 weeks. On July 9, 2025, PepsiCo, Inc. (NASDAQ:PEP) stock closed at $134.48 per share, with a market capitalization of $184.383 billion.

ClearBridge Dividend Strategy stated the following regarding PepsiCo, Inc. (NASDAQ:PEP) in its second quarter 2025 investor letter:

"We exited PepsiCo, Inc. (NASDAQ:PEP), in the consumer staples sector. Although the company’s international business has been executing well, the continued lack of a clear strategy to turn around the slide in snacks continues to weigh on PepsiCo’s long-term trajectory. Combined with shifting consumer preferences away from its core brands toward health-focused alternatives and the dissemination of GLP-1 medication, we elected to exit the position in pursuit of areas offering greater opportunity."

PepsiCo, Inc. (NASDAQ:PEP) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 71 hedge fund portfolios held PepsiCo, Inc. (NASDAQ:PEP) at the end of the first quarter, which was 69 in the previous quarter. While we acknowledge the potential of PEP as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered PepsiCo, Inc. (NASDAQ:PEP) and shared best stagflation stocks to buy. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.