PepsiCo Inc (NASDAQ:PEP) stock was last seen up 3.6% at $153.97, after the Wall Street Journal reported that activist investor Elliott Investment Management has taken a $4 billion stake in the beverage giant, citing a "rare" and "historic" opportunity for a turnaround. The shares have been underperforming on the charts, while the company cuts costs to improve its margins.
Should these gains hold, PEP will mark its largest single-day percentage gain since a 3.8% pop in April. The stock has been chopping higher since its June 26 five-year low of $127.60, fresh off a third-straight monthly gain. Breaking into positive territory for 2025, the equity is still down 11.2% year-over-year.
Options traders are chiming in on the report, with 13,000 calls and 7,450 puts exchanged so far -- triple the overall options volume typically seen at this point. The September 160 call is the most popular, followed by the weekly 10/10 150-strike put, with new positions being bought to open at the latter.
Short-term options traders have been favoring puts lately. PEP's Schaeffer's put/call open interest ratio (SOIR) of 1.02, which ranks in the 74th percentile of annual readings.
The majority of analysts are bearish on PepsiCo stock, leaving plenty of room for upgrades if Elliott succeeds in its turnaround efforts. Of the 21 brokerages in coverage, 15 carry a "hold" or worse, with six a "strong buy."
