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As often happens when a prominent company is about to publish a quarterly earnings report, analysts have been adjusting their price targets in anticipation. In this case, it’s PepsiCo (NASDAQ: PEP). Evaluations of the big beverage and snack food conglomerate run the gamut from poor to excellent, and one of the more optimistic takes on the company’s stock anticipates a double-digit percentage upside potential in its price.

Banking on continued profitability

The analyst with that rosy view of PepsiCo’s future is Bank of America Securities analyst Bryan Spillane. The company is slated to unveil its second-quarter results later this week and on Monday Spillane cut his price target on the shares to $190 apiece from the former level of $210. Despite the target drop, the analyst remains bullish on PepsiCo, rating it a buy. Spillane’s target implies a 17.2% upside over the next 12 months for the stock.

While the analyst said he is concerned with relatively soft demand in the food and beverage industry, he also feels that PepsiCo stock is attractively priced at its current levels. He also pointed out a pleasing reality for the company, in that it consistently lands in the black and generates comfortable margins.

That shouldn’t change, in his view. Spillane wrote in his latest PepsiCo note that the company’s “long-term earnings power remains reasonably stable.”

PepsiCo is an attractive stock in numerous ways

I’ve been a fan of PepsiCo’s business for years, and I continue to think its stock is a good buy. Those modest valuations are tempting in the same way a pack of Doritos or an ice-cold Pepsi is. Speaking of which, both of the company’s product segments (snacks and drinks) occupy pride of place on supermarket and convenience store shelves.

Since I’m a dividend guy, I also very much like PepsiCo’s emphasis on its payout. Every quarter it reliably hands out a distribution, which these days tops 3% in yield.

PepsiCo is scheduled to publish its second-quarter earnings release before the market opens Thursday, July 11. The report should confirm this stock is worth a closer look.

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Bank of America is an advertising partner of The Ascent, a Motley Fool company. Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bank of America. The Motley Fool has a disclosure policy.

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